Written answers

Thursday, 14 January 2016

Photo of Catherine MurphyCatherine Murphy (Kildare North, Social Democrats)
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30. To ask the Minister for Finance further to Parliamentary Question No. 166 of 15 July 2014, the schedule and periodic amounts, under which the proceeds of the sale of the Central Bank of Ireland's €25 billion floating rate notes and €3.4 billion fixed coupon 2025 bonds acquired following the liquidation of Irish Bank Resolution Corporation were disposed of since that date; why these amounts are higher than the amounts projected by him; what the revised future schedule of disposals will be at this point; what benefit or disadvantage has accrued to the State as a result of this changed policy; and if he will make a statement on the matter. [1350/16]

Photo of Michael NoonanMichael Noonan (Limerick City, Fine Gael)
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Subsequent to the liquidation of IBRC the Central Bank acquired €25.034bn of Floating Rate Notes (FRNs) and €3.46bn of the fixed rate 5.4% Treasury Bond 2025.

The table below sets out the details in respect of each of these bonds and their nominal amounts at year-end 2015. Reported subsequent movements in the Central Bank's holdings are reflected in the commentary below the table.

Full details of the FRNs and the fixed rate bond, including the offering circulars can be found on the website of the National Treasury Management Agency (NTMA) at

Note TypeRateMaturityOriginal Nominal acquired by CBI (€m)Nominal held by CBI as at year-end 2015 (€m)
Floating Rate Note6 month Euribor+268bps18/06/535,0345,034
Floating Rate Note6 month Euribor+267bps18/06/515,0005,000
Floating Rate Note6 month Euribor+265bps18/06/493,0003,000
Floating Rate Note6 monthEuribor+262bps18/06/473,0003,000
Floating Rate Note6 monthEuribor+260bps18/06/453,0003,000
Floating Rate Note6 month Euribor+257bps18/06/432,0002,000
Floating Rate Note6 monthEuribor+253bps18/06/412,0001,500
Floating Rate Note6 monthEuribor+250bps18/06/382,0000.00
Fixed Rate5.40%13/03/253,4610.00*

* As at 11 January 2016, the total nominal outstanding of this entire bond was €11,745m.

As outlined in the Central Bank's Annual Report for 2014 published on 1 May 2015, the Bank has sold its €3.46bn holding of the fixed rate 5.4% Treasury  Bond 2025; €350m in 2013, followed by another €2.3bn in 2014 and the remainder in early 2015.

Also outlined in the 2014 Annual Report was the Bank's disposal of €500m nominal of the 2038 FRN to the NTMA on 22 December 2014. A further €500m nominal of the 2038 FRN was sold to the NTMA on each of the following dates: 26 June 2015, 18 August 2015 and 23 October 2015. Following these purchases and subsequent cancellations by the NTMA, the 2038 FRN was retired with no amount outstanding.

On 21 December 2015 the Bank disposed of €500m nominal of the 2041 FRN to the NTMA. Following this purchase and subsequent cancellation by the NTMA, the total nominal outstanding for this bond has been reduced to €1.5 billion.

Following these cancellations, the overall total nominal outstanding for all of the FRNs held by the Central Bank reduced from €25.034 billion to €22.534 billion at end-2015.

The Central Bank indicated a minimum disposal schedule of €0.5 billion up to the end of 2014, €0.5 billion per annum 2015-2018, €1 billion per annum 2019-2023 and €2 billion per annum after that until all the bonds are sold. However, the Bank also stated that it would dispose of the government bonds as soon as possible, provided conditions of financial stability permit.  This position remains unchanged. Due to improved financial stability conditions, the disposals of fixed and floating rate government bonds from the Special Portfolio have been faster than the minimum.

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