Michael McGrath (Cork South Central, Fianna Fail)
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Question 85: To ask the Minister for Finance the progress that has been made recently in relation to restructuring the banking debt; and if he will make a statement on the matter. [17483/12]

Michael Noonan (Limerick City, Fine Gael)
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As the Deputy is aware the Government is committed to reviewing the approach to the Promissory Notes with a view to reducing the overall cost to the State. The Troika have agreed to engage in a process with Irish Officials to produce a common paper which will consider all options for restructuring the notes in terms of the source of funding, the duration of the notes, the interest rate etc. In tandem with this review, the European authorities have opened a discussion on how best the Irish banking system and the Irish State can benefit from having further improvements to certain elements of the banking sector. The overall purpose would be to improve the position of the banks in which the State has a major investment.

Under the terms of the Promissory Note the State to make cash payments of €3.06 billion each year to IBRC. The discussions with the European authorities on the general issue continue but we are now negotiating with the EU authorities on the basis that the €3.06 billion cash instalment due from the Minister to IBRC on 31 March 2012 could be settled by the delivery of a long term Irish Government Bond. The details of the arrangements are still being worked on.