Pearse Doherty (Donegal South West, Sinn Fein)
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Question 207: To ask the Minister for Finance if Bank of Ireland is accepting an interest rate of 2.35% on its lending to IBRC as part of the Government bond transfer; and if so, the reason BOI is willing to take this rate, when the current yield on an Irish Government bond which matures in April 2013 is over twice this rate. [27937/12]

Michael Noonan (Limerick City, Fine Gael)
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As the deputy is aware the securities repurchase transaction between Bank of Ireland ("BoI") and Irish Bank Resolution Corporation ("IBRC") is a commercial transaction and is subject to the approval of BoI's shareholders. BoI has issued a circular to their shareholders (the "Circular") and scheduled an extraordinary general court to be held on 18th June 2012. The commercial terms of the securities repurchase transaction are set out in the Circular. As set out in the Circular the interest rate on BoI's lending to IBRC will be a percentage per annum calculated to cover the BoI's on-going cost of funds in financing the Irish government bonds through the ECB's open market operations plus an amount equal to 1.35%.

As I have previously stated this is a commercial transaction between BoI and IBRC. I refer the deputy to the Circular where BoI have set out the key benefits of the transaction to their shareholders.