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THE SEVEN IRISH banks covered by the two guarantee schemes introduced by the government in 2008 and 2009 have so far paid €3.36 billion in fees to the Exchequer, new figures have shown.
Figures released by the Department of Finance show that over €750 million has been paid in fees by seven institutions which were covered by the blanket guarantee introduced in September 2008 and which ran for two years.
The other €2.6 billion has been paid under a second guarantee, the Eligible Liabilities Guarantee scheme, under which the State also agreed to guarantee new deposits and any newly-issued bonds within a certain period. That scheme remains in place.
Around half of the fees accrued from the latter scheme were collected in 2011, when AIB paid fees of €465 million and Bank of Ireland €449 million.
Fees from the scheme have slowed slightly since then, with about €515 million paid to the State so far this year – again, with AIB and Bank of Ireland making up the lion’s share at €205 million and €189 million respectively.
The Irish Bank Resolution Corporation, the institution formed by the merger of Anglo Irish Bank and Irish Nationwide, has paid a total of €251 million under the ELG scheme.
Bank of Ireland and AIB are again the largest contributors under the previous blanket guarantee, having paid €239 and €233 million in the lifetime of that scheme. Anglo paid €188 million, while Irish Nationwide contributed €33 million.
EBS Building Society – now a subsidiary of AIB – paid €15.6 million, while Irish Life & Permanent paid a total of €50.2 million. Postbank, the financial services arm of An Post, paid €39,000.
Aside from the fees for being covered under the schemes, the banks have also paid a total of €5.35 million to cover the State’s administrative and legal costs.
The State has spent a total of €64.1 billion recapitalising the banking sector, including a total of €20.7 billion on the now-defunct IBRC. Some of that amount has been converted into shares in each institution, which could be sold on – possibly to the new Eurozone bailout fund – at a later point.
The transactions are largely circuitous, given that the State now almost fully owns each of the institutions covered by the guarantee. The only exception is Bank of Ireland, in which the State owns a 15.1 per cent stake. AIB is 99.8 per cent owned by the taxpayer.
The figures were released in response to parliamentary questions from Labour’s Joanna Tuffy.
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Bank customers are paying it same way we paying tax after tax.
Govt. pay themselves a lot of money from institutions they practically own, and hail banks for paying it?? This is merely dressing up the figures, in order to make a bad situation look good. Exactly what got us into the banking mess in the first place. Feel sorry for BOI, they are trying to comply with paying these huge sums, while been pressured into trying to lend. If you freed up the 0.5 billion that they are needlessly paying the govt then they would have a better chance. I know they owe this money, but when this 3.3billion isn’t going to affect cuts in the budget, then aren’t we better to leave it in the bank, where it could be loaned out and have a positive impact on people’s personal and business lives, possibly help creat jobs and employment?
What, what, what?
You’re saying we should not take anything back from the banks but leave it on their balance sheet so it can be loaned back by them into the real economy?
We tried that; it was called the bank guarantee. We gave them
Tens of billions in the hope that they’d get the economy going again. Instead theyve shored up their own balance sheets and told SMEs, first time buyers and those in severe debt to go whistle.
I must be reading your post wrong as it’s only got thumbs up. What am I not getting?
It got thumbs up because it criticises the government – thats all it takes.
Other content doesn’t matter.
So where does this 3 billion go? State coffers..? Our education system?..health system?..bondholders?
To the other side of the same entities balance sheet or profit and loss account.
sounds good Paul but what do those words actually mean?
They pay an expense – cash out (to govt) and hits their profit and loss.
What does your ‘other side’ bit mean?
I may not have expressed my comment in the manner I meant it.
Yes! The banks should pay back the money!! Do I feel it should be done sooner rather than later? Yes again!!
Do I feel that the govt are going to use any of this 3.3b to ease the pain on the taxpayer? No!
I am usually commenting on the side of the govt, and I would consider myself a realistic person, but in my opinion, right now that money being transferred to the govt with no clear benefit to the irish citizen is merely money that could be used to support SME’s around this country that are providing employment to many people around the country and asking banks to help them grow!
I apologise if you read my comment and decided to like it for the sole reason that it gave out about the govt, as that type of person really annoys me, and also the flip side if you thought I was just trying to denounce the govt and disliked. I made what I seen as a logical statement and am quite happy to debate my point
Irish economy and culture.. matches so well!
“Sounds like a fairytale economy Atom. How about an Aesops fable to go with it..
The terrible twins, private and public greed built a shiny tower on a borrowed foundation. Private being the most ambitious extended his part of the tower into the stratosphere while public being the more cautious of the two, was happy to live in the clouds once private paid him rent. They were both extremely happy once public supported private and allowed him to party hearty. Unfortunately neither were very good at sums and miscalculated the strength of the foundation. Now that private has fallen off his publicly supported perch and is on the ground with the common people all he can do is throw rocks at public and curse his ability to hang on. For the common man nothing much has changed. As before he looks on in bewilderment at the cost of supporting both. P>S I keep paying out for so-called shares in Irish banks.. where’s my dividends! So sick of hearing of glossy old shite by this Gov!
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