Michael McGrath (Cork South Central, Fianna Fail)
Link to this: Individually | In context

Question 135: To ask the Minister for Finance, in the context of the planned sale or run-off of more than €70 billion of non-core assets in AIB, Bank of Ireland, EBS and Irish Permanent, if he will confirm the expected overall loss or discount on the sale of these non-core assets which have been factored into the recapitalisation figure of €24 billion; and if he will make a statement on the matter. [7602/11]

Michael Noonan (Limerick City, Fine Gael)
Link to this: Individually | In context

On 31 March the Central Bank published full details of the capital requirements for AIB, Bank of Ireland, EBS and Irish Life and Permanent. In their Financials Measures Programme document they provided a detailed breakdown of the calculations that underpinned their €24bn capital requirement which they identified for these banks. In arriving at this €24bn figure, the Central Bank indicated that a loss of €13.2bn had been allowed for the cost of deleveraging loans. This cost represents the impairment loss associated with loans that are scheduled to be sold over the 2011-13 period, net of provisions taken,and for clarity included a loss for so called NAMA 2 exposures, or those land and development loans in AIB and Bank of Ireland with a value less than €20m that were to transfer to NAMA. I should point out that this €13.2bn cost is not the exact capital impact associated with these disposals and as such is not directly comparable with the €24bn capital number identified for the banking system. There are certain accounting adjustments for risk weighted asset relief etc. that must be implemented before the strictly equivalent capital figure can be determined.