Written answers
Tuesday, 17 July 2012
Department of Finance
Banks Recapitalisation
8:00 pm
Peter Mathews (Dublin South, Fine Gael)
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Question 96: To ask the Minister for Finance the details of total cost of the banking collapse in Ireland provided by the Governor of the Central Bank of Ireland to a conference (details supplied) which included costs to foreign banks operating here, costs to shareholders and liability management exercises undertaken by the banks; and if he will make a statement on the matter. [34630/12]
Michael Noonan (Limerick City, Fine Gael)
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I believe the Deputy is referring to a speech delivered by the Governor of the Central Bank of Ireland at the Institute for International and European Affairs (IIEA) on 29 June 2012 entitled – "More Europe" in the Financial Arena: Good for Ireland? The Central Bank has supplied me with the following breakdown of the allocation of banking losses/cost of capital injections that I understand the Governor referred to at the conference:
Allocation of Losses/ Costs of Capital Injections 2009-2011* | €'billion |
Liability Management Exercises | 14 |
Write-down of Shareholders Funds in ELG Banks | 29 |
Write-down of Shareholders Funds in Foreign Banks | 28 |
Government Measures | 64 |
125 |
* Internal Central Bank Estimates as at 1 June 2012
For further details on the cost of banking recapitalisation to the State, please see the table below:
€bn | AIB/EBS | BoI | IL&P | IBRC (Anglo/INBS) | Total |
Government preference Shares (2009) - NPRF | 3.5 | 3.5* | - | - | 7.0 |
Capital contributions (with Promissory Notes as consideration) /Special Investment Shares (2010) – Exchequer ** | 0.9 | - | - | 30.7 | 31.6 |
Ordinary Share Capital (2009) – Exchequer | - | - | - | 4.0 | 4.0 |
Ordinary Share Capital (2010) - NPRF | 3.7 | - | - | - | 3.7 |
Total pre-PCAR 2011 (A) | 8.1 | 3.5 | 0 | 34.7 | 46.3 |
PCAR 2011: | AIB/EBS | BoI | IL&P | Anglo/INBS | Total |
Capital from Exchequer*** | 3.9 | - | 4.0 | - | 7.8 |
NPRF Capital | 8.8 | 1.2 | - | - | 10.0 |
Total PCAR (B) | 12.7 | 1.2 | 4.0 | - | 17.8 |
Total Cost of Recap for State (A) + (B) | 20.7 | 4.7 | 4.0 | 34.7 | 64.1 |
* €1.7bn of BoI's government preference shares were converted to equity in May/June 2010 (€1.8bn still left in existence). The government also received €0.5bn from the warrants relating to BoI's preference shares (excluded from table above). | |||||
** The IBRC amount is made up of a total capital contribution for Anglo / INBS of €30.6bn and a special investment share of €0.1bn (INBS). The Anglo / INBS capital contribution impacted in full on the GGB in 2010. The consideration for the Anglo / INBS capital contribution was €30.6bn of promissory notes. These Promissory Notes are an amount due from the State to IBRC. Each year, on 31 March, €3.06bn is paid by the Exchequer to Anglo / INBS as part of the scheduled repayments of the promissory notes. The first such repayment was made on 31 March 2010. | |||||
*** The Exchequer cost of the 2011 BoI recap is shown net of share sale to private investors (Completed in October, 2011) | |||||
**** €1.3bn of the €4bn used to recapitalise IL&P was invested through the acquisition by the Minister of Irish Life from IL&P. It is expected that the proceeds of an onward sale of Irish Life in due course will reduce the amount the State has committed to the bank recapitalisation. |
This recapitalisation table split year by year is:
Anglo | INBS | AIB | EBS | BOI | IL&P | Total | |
2008 | |||||||
2009 | 4.0 | 0 | 3.5 | 0 | 3.5 | 0 | 11.0 |
2010 | 25.3 | 5.4 | 3.7 | 0.9 | 0 | 0 | 35.3 |
2011 | 0 | 0 | 12.7 | 0 | 1.2 | 2.7 | 16.5 |
2012 | 0 | 0 | 0 | 0 | 0 | 1.3 | 1.3 |
29.3 | 5.4 | 19.9 | 0.9 | 4.7 | 4.0 | 64.1 |
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