Pearse Doherty (Donegal South West, Sinn Fein)
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Question 138: To ask the Minister for Finance the contribution made by the State to the first bailout in Greece in 2010; the way this contribution was accounted for in the deficit and national debt figures; the amount of interest received by Ireland from this contribution; when the sum is due for repayment by Greece to Ireland; if he will provide an assessment of the prospects for the repayment of the contribution; if any provision will be made for any non-repayment in our national accounts. [33729/12]

Michael Noonan (Limerick City, Fine Gael)
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Under the Euro Area Loan Facility as agreed for Greece in May 2010, stability support in the form of a joint Euro area/IMF financing package of €110 billion is being provided to Greece over a three-year period. Ireland contributed €345.7 million (net of a 50 basis points service charge) in respect of the first two tranches of the loan in 2010. Ireland withdrew from participation in the facility when we entered the EU/IMF Programme of Financial Support.

This amount was accounted for as a loan under non-voted capital expenditure.

Interest payments on the loan in respect of Ireland's contribution to the facility are due quarterly and are calculated on the full nominal amount of the loan (i.e., including the 50 basis points service charge). The original loan agreement provided that the principal would be repayable quarterly over two years starting in 2013 and that the rate of interest, which is variable, would be based on three-month EURIBOR (the average rate at which euro interbank term deposits are being offered by one prime bank to another within the EMU zone) plus a margin of three hundred basis points (3 percentage points) for the first three years and four hundred basis points subsequently. However, the lending countries agreed in 2011 to extend the grace period and term of the loans and to reduce the margin in the interest rate charged to Greece to 100 basis points (one percentage point). As a result, the principal on Ireland's loan to Greece is due to be repaid over five years beginning in June 2020.

The total amount of interest received by Ireland on the loan to date is €25.96 million.

As the Deputy will be aware, Greece came to an agreement with its private sector creditors in March 2012 which allowed it to restructure debt held by banks and other private investors. However, that restructuring and the consequent losses for investors did not apply to loans under the Euro Area Loan Facility under which Ireland provided a loan to Greece in 2010.