Minister must clearly explain decision on timing of Bank of Ireland shareholding sale
23 June 2021
Spokesperson on Finance, Public Expenditure and Reform
- Unclear why sale of State share must take place now
- Money from sale must be ringfenced for home building
Labour’s Finance spokesperson Ged Nash has said the Minister for Finance must explain in clear terms why he has decided to sell the State’s shareholding in Bank of Ireland at this point in time.
Deputy Nash said:
“The timing of this announcement requires a detailed explanation from the Minister for Finance. Why has the Government moved to divest itself of its shareholding in Bank of Ireland now, when the price of bank shares is climbing and is likely to continue to do so as the economy recovers?
“In parliamentary question replies, the Minister has made it clear that he ‘(does not see) the State as a long-term investor in the banking sector and its (the government’s) policy of selling down its investments in the Irish banks remains unchanged.’
“This is in my view is a short-sighted and dogmatic position to adopt and the State can, if so minded, use its function and shareholdings much more strategically. It could for example be much more pro-active in helping to create the conditions for the evolution of a third banking force to challenge the duopoly of AIB and Bank of Ireland and to promote greater competition.
“If the Government gets the timing of this sale wrong, the Exchequer could end up hundreds of millions of euros out of pocket compared to what we might get for our share if a sale was to take place further down the line. The Minister must get the best possible return for the State and he needs to explain why he has taken this decision now.
“The Labour Party firmly believes that the money obtained from any sale should not be used to pay down debt but should instead be utilised to build public housing in order to derive a clear social benefit from the taxpayers’ support for the Bank.”