Bríd Smith (Dublin South Central, People Before Profit Alliance)
Link to this: Individually | In context | Oireachtas source

53. To ask the Minister for Finance his plans to sell a bank (details supplied); and if he will make a statement on the matter. [16468/17]

Tommy Broughan (Dublin Bay North, Independent)
Link to this: Individually | In context | Oireachtas source

77. To ask the Minister for Finance his plans for a bank (details supplied); the way in which this State asset should be best utilised for Ireland's long-term economic development; and if he will make a statement on the matter. [16419/17]

Michael Noonan (Limerick City, Fine Gael)
Link to this: Individually | In context | Oireachtas source

I propose to take Questions Nos. 53 and 77 together.

It is the Government's intention that the State will exit its banking investments in a measured and careful manner returning their ownership to the private sector over time. I have been clear in stating that my primary objective in the disposal of these assets will be recovering the maximum amount of money for the Irish taxpayer. In the case of AIB I have indicated that an IPO (Initial Public Offering) is the optimal route to recouping value from our investment. This will serve to reduce our national debt, de-risk our exposure over time yet at the same time enable us to benefit from a hoped for improvement in the banks fortunes in the medium term.

The earliest possible IPO window for the bank is the second quarter of 2017 with a second window in the autumn. Indeed, officials in my Department along with our independent financial adviser, Rothschild, have done considerable preparatory work in this regard. In December of last year, following a competitive procurement process, three firms were appointed to act as joint global co-ordinators to lead a selling syndicate in preparation for a possible IPO. On the 23 March, I further announced the addition of five joint bookrunners and a co-lead manager to the syndicate. The firms have been appointed for an eighteen month period. The appointment of the firms as advisers does not signal any intention or obligation for us to proceed with a transaction. Given the improved state of our national finances we are under no pressure to sell, and so any decision to do so will be subject to a number of factors, including favourable market conditions.

AIB published its 2016 financial results on Thursday, 2 March 2017 and these confirmed the ongoing strong performance by the bank with sustainable profits, strong capital generation and very significant lending into the Irish economy. The proposal of a dividend payment of €250m to ordinary shareholders, almost all of which will accrue to the State, is particularly significant given that it has been nine years since the bank last paid a dividend to its shareholders. These results confirm the view that 2017 represents an appropriate time to consider an IPO for the bank.

Clearly, in order for us to proceed with the sale of any of our banking assets, we would need to be satisfied that the market is prepared to put a fair and reasonable value on the relevant business, bearing in mind its current performance, its future prospects and the outlook for the Irish economy. Officials in my Department continue to monitor market conditions and the performance of banking equities with a view to planning appropriate exit strategies, consistent with what is set out in the Programme for a Partnership Government.