Anthony Lawlor (Kildare North, Fine Gael)
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133. To ask the Minister for Finance given the analysis being carried out by a company (details supplied) on the possible sale of Allied Irish Banks shares, depending on the advice received, if it is envisaged that this money will be used to reduce the national debt or if it will be invested in capital projects; if a cost-benefit analysis and an analysis of the economic benefits of investing in capital projects has been completed; and if he will make a statement on the matter. [26119/15]

Michael Noonan (Limerick City, Fine Gael)
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AIB is  well on the road to recovery and officials in my department are working with AIB on reconfiguring its capital structure and setting out a path for the bank to begin to return capital to the State. Given the scale of the State's investment - some €20.8 billion - and the different financial instruments this money is invested in, there are a range of options available to recoup value from the bank and it is critical that we get these decisions right. As a result Goldman Sachs International and William Fry are assisting the Department with this work by providing financial and legal advice respectively.  

Reconfiguring the bank's capital structure, which is not longer fit for purpose given the new regulatory regime, is just the start of the process, but it is an essential first step on the road to recovering value for the taxpayer. Discussions commenced recently with the SSM (Single Supervisory Mechanism) and the Central Bank, AIB's regulators, regarding AIB's capital structure and this process is expected to take a number of months.  

No decision has been made by the Government to sell any of our investments in AIB. All options remain on the table and while I have said previously that an Initial Public Offering or IPO on the stock market, looks like the most likely exit route for the State, it is too early to specify what steps will be taken or to put a timeline on decisions. Any sale will involve selling shares held by the ISIF.

As I have previously stated on numerous occasions, Government policy is that we will not remain a holder of our banking investments in the long term. Given our high debt to GDP ratio, we do not have the luxury of holding all of these investments indefinitely and I envisage receipts from the gradual sale of these investments helping to play their part in reducing the State's overall debt burden in the coming years.