Written answers

Tuesday, 9 June 2015

Photo of Lucinda CreightonLucinda Creighton (Dublin South East, Independent)
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288. To ask the Minister for Finance if it is the expectation of the Special Liquidator that unsecured senior and subordinated bondholders will be repaid from the surplus of the Irish Bank Resolution Corporation asset disposal; if he expects this to occur at some stage, now or in the future, when litigation matters are wound up; and if he will make a statement on the matter. [21240/15]

Photo of Lucinda CreightonLucinda Creighton (Dublin South East, Independent)
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289. To ask the Minister for Finance further to a person's statement at the Public Accounts Committee on 14 May 2015, the total number of creditors who applied before the end of March 2015; the total number of United States of America creditors who have applied for a date in seeking distribution to them of the €1.85 billion; the total nominal amount of moneys sought by senior and subordinated bondholders; the total single entity holders of senior or subordinated bonds; if any of the surplus shall be distributed before the settlement of the outstanding cases; and if he will make a statement on the matter. [21241/15]

Photo of Michael NoonanMichael Noonan (Limerick City, Fine Gael)
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I propose to take Questions Nos. 288 and 289 together.

As the Special Liquidators maximise the proceeds of the liquidation, it is important that they have a comprehensive view of the creditors who ultimately may be entitled to these proceeds. To this end, the Special Liquidators have published advertisements and have written to known creditors in order to finalise their claims in the liquidation. Creditors in the UK and Ireland had until 31 March 2015 to submit their claims and those creditors in the US had until 31 May 2015.

There were c. 2,700 claims made by creditors by 31 May 2015. The adjudication of all creditor claims is ongoing. Once the creditor adjudication process is complete, the Special Liquidators will write to each claimant to confirm whether their claim(s) have been admitted as valid claims against Irish Bank Resolution Corporation Limited (in Special Liquidation).

The Special Liquidators are unable to comment at this stage both on the level of proceeds that will ultimately be generated from the liquidation and on the level of valid creditor claims that will ultimately be received in respect of the liquidation. It is the balance between the proceeds generated and level of valid claims that will ultimately determine the dividend to which each creditor may be entitled.

The ultimate level of dividend paid, if any, to each creditor cannot be known until such time as all loan assets are sold, the total level of adjudicated creditors is finalised and the other contingent creditor claims which may crystallise, including those from litigation, are known.

For the payment of proceeds from the liquidation, unsecured creditors will rank in priority to the holders of subordinated debt. The priority for the distribution of assets under the Companies Acts is generally:

- Costs and expenses of the ongoing liquidation (these claims are certain to be paid in full) ;

- Preferential creditors, including certain taxes and employee and pension claims arising prior to the date of liquidation (these claims are certain to be paid in full);

- Amounts owing to NAMA under the Facility Deed acquired from the Central Bank which were secured by a floating charge over the banks assets (these claims have been fully repaid and the floating charge has been released);

- Unsecured creditors, including:

- Debts owing to the Minister/NTMA under ELG

- Debts owing to the Deposit Guarantee Scheme

- Unguaranteed debt/depositors

- Unknown, including:

- Local authority development bonds

- Suppliers/other "normal" unsecured creditors

- Employees that are not preferential creditors

- Contingent creditors and other potential costs principally relating to litigation, etc. 

- Subordinated creditors

- Members of the company - the Minister currently holds 100% of all shares and preference shares in the company.

The Special Liquidators hope to be in a position to make an interim dividend to those unsecured creditors whose claims have been deemed valid in Q4 2015.

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