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The end of IBRC and what happens next

Posted on February 07, 2013

What was the Emergency Legislation introduced last night, 6 February 2013?

The emergency legislation, the Irish Bank Resolution Corporation Bill 2013, was introduced last night, 6 February 2013, to liquidate IBRC.

This brings to an end the ‘dead bank’ IBRC, formerly Anglo-Irish Bank.

Assets belonging to IBRC have been transferred, under the legislation, to NAMA, the National Assets Management Agency.

A Special Liquidator has been appointed who will be responsible for addressing the employment needs of the former IBRC employees.

What has this got to do with the promissory notes?

The Government has been in on-going discussions with the European Central Bank to reach an agreement on reducing the severe burden imposed by the Promissory Notes, the IOUs, on Ireland’s taxpayers.

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Gilmore welcomes IBRC Liquidation

Posted on February 07, 2013

Speaking in Dail Eireann onIrish Bank Resolution Corporation Bill 2013

I welcome this opportunity to speak in support of the Bill before the House tonight. 

This Bill, when enacted, will finally bring an end to the Irish Bank Resolution Corporation, IBRC. The IBRC is made up of what remains of Anglo Irish Bank and the Irish Nationwide Building Society. These two institutions, names that will live on in ignominy, are forever associated with the recklessness and greed of a tiny clique that brought this country to the edge of financial ruin. These banks, the people who ran them and the golden circle around them were at the very roots of the crisis that has caused so much distress to the Irish people. 

In liquidating this institution, we are doing what should have been done on the night of the blanket bank guarantee. 

That great error of policy and politics sought to keep Anglo Irish Bank and Irish Nationwide Building Society in existence when they should at that point have been put into a proper resolution process. 

This Government is doing what the previous Government should have done - we are ending Anglo Irish Bank, not scrambling to keep it alive. This is what did not happen in 2008, and the history of what followed is well known. The State took on a risk in giving a blanket guarantee to Anglo Irish Bank and other banks which ultimately it was unable to bear and the previous Government was forced to seek international assistance to sustain the finances of the State. 

Tonight, we are wiping these two institutions out of existence for good. We are winding up these institutions and transferring the remaining work of managing out their loans to NAMA. This is part of a broader package of banking measures we are working on with our partners in Europe, which is intended to deal with some of the outstanding issues that remain in our banking system. As the House is aware, we are continuing our negotiations with the European institutions on other aspects of this package, including how to deal with the promissory note. The winding up of IBRC is one component of this package. Negotiations will continue on the other elements, 

This is the first necessary step in resolving the promissory note issue. When the Government was formed, it committed itself to the renegotiation of the bad promissory note deal entered into by Fianna Fáil and its supporters. There were those who said, when this Government was formed, that a renegotiation of the promissory note deal could not be done. There were also those who said we would not succeed in the negotiations. There were those who predicted failure at every twist and turn. There are some in the House whose biggest difficulty tonight is that the Government is succeeding. 

During this week a series of rumours began to circulate about the future of IBRC which in the opinion of the Government constituted a potential financial risk. Today, the Minister for Finance took the view that these risks had become too great to sustain. Accordingly, and in line with a contingency plan which has been in place for some time in the Department of Finance, he moved to secure the company, and tonight we are moving to provide formally for its liquidation. This action is necessary to secure the value of the assets held by the company. These assets, which are valued at €12 billion, are being secured in the public interest. 

I am conscious that this will be an anxious time for the members of staff in IBRC. Every Member of the House acknowledges that no blame rests with the staff who worked in IBRC. 

Many of the staff joined the bank in recent times and have worked diligently to secure the value of its assets in the public interest. Regrettably, it has been necessary to make this announcement at short notice. It is intended the majority of them will be employed by the liquidator, at least for some time. 

The Minister for Finance has set out the legal standing of the employees and the protections that are provided for them in law. I emphasise and reassure the House with regard to a matter raised by Deputy Michael McGrath that the legal cases currently being taken by IBRC will not be affected by the liquidation. In effect, where legal proceedings are currently being taken by IBRC against borrowers in default, these will now be pursued by NAMA. 

Moving on, the liquidation of IBRC is of itself an important step in the process of programme exit. It has been the Government's view for some time that eliminating the legacy risk and the possibility of so-called "tail risk" in IBRC is important in the ongoing process of rebuilding confidence in Ireland, which is a necessary part of programme exit. 

By eliminating these two most notorious institutions, markets will have a clearer view on this risk. 

Other steps that have been taken in recent times include the sale of the contingent capital in the Bank of Ireland, and the agreement reached to examine the term extension of European programme loans. As we have taken these steps, we have continued to see the yield on Irish Government debt declining towards far more sustainable levels. 

This Bill is another step in that process. It is also part of a wider package of measures that we are negotiating with our European partners - negotiations that continue and which we hope to bring to a satisfactory conclusion soon. 

The Irish people have endured great loss and great difficulties at the hands of the bankers who ran these banks. The measures taken to save them were wrong and the EU-IMF programme of support that followed was, in the view of this Government, unfair and unworkable. Since coming to office, we have worked with the troika and European partners to renegotiate the programme and to redesign it bit by bit. We are succeeding. 

Tonight we are taking another important step in that process and further steps will follow. There is no one step that will right all the wrongs the Irish people have endured. There is no fairytale solution that will bring us back to where we ought to be. What we can do, and are doing, is to patiently negotiate our way through a series of issues, working step by step to deal with the three-legged crisis we inherited - the crisis in banking, the public finances and jobs. 

Today is a watershed. The significance of liquidating Anglo Irish Bank will not be lost on the Irish people. What is most important, however, is that this is another step forward towards the day when we can finally face forward as a people, when the past can finally recede into the distance and when Ireland and the Irish people can see the future that they truly deserve. 

I am disappointed by the contributions that have been made by some Members of the Opposition. In fairness to Deputy Michael McGrath, he made a thoughtful contribution. The only piece missing from the speech was to mention that what we are doing here is clearing up a mess caused by Fianna Fáil in the first place. 

I have to say the contributions of other Members were quite remarkable. Here we had Member after Member, whether from Sinn Féin or from the various views contained on the Opposition benches, people who have spent the past two years calling for the liquidation and winding up of the IBRC on the very night we introduce the legislation to do just that, the only thing we could hear from these Deputies was them scrambling to find some kind of an argument on which to oppose it. I have to say the arguments they found were bizarre, ridiculous and bear no examination by anybody who wants to see a serious debate on these issues.

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Core Social Welfare payments protected in Budget 13

Posted on December 12, 2012

Protecting the less well-off has been prioritised by the Government in Budget 13. Core social welfare packages have been protected despite the gap in our public finances of €13.5bn and the need to make savings in Social Protection to the order of €390m.

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The days of the Golden Circle are over, Gilmore tells the Dáil

Posted on November 08, 2012

This morning's Leaders' Questions saw debate on SUSI and delays in awarding students grants, pensions and the Tánaiste Eamon Gilmore expressed his outrage at the level of some bankers' pay and pensions and assured the House that 'the days of the golden circle are over'.

You can watch the entire debate on the accompanying video.

If you're on Twitter you can follow Labour from here and keep up-to-date with everything that's happening by connecting with Labour on Facebook.

Permanent link | Comments | Categories: EducationFinanceLeaders Questions

Economic recovery is about people and a better life

Posted on October 25, 2012

Yesterday evening the Tánaiste Eamon Gilmore addressed the Dáil speaking about the economy, you can watch his contribution in the accompanying video or read a transcript of his speech below. The contribution made by Minister Pat Rabbitte is available on our You Tube channel at this link.

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Stimulus Package another step on path to recovery

Posted on July 17, 2012

A €2 ¼ billion infrastructure Stimulus Plan has been announced today by Minister Brendan Howlin, representing a step in the right direction on the path to recovery with the creation of 13,000 jobs, €280m investment in education, €115m in health, €850m in transport, €190m in justice and €1.4b in projects that meet key infrastructural needs.

Among the projects to benefit will be the development and rejuvenation of a campus for the Dublin Institute of Technology at Grangegorman; the upgrading of the N17/N18 Gort to Tuam motorway and the M11 Gorey to Enniscorthy project.

Other projects include €190m to be invested in the State Pathology Laboratory, two new Garda headquarters as well as the provision of two bundles of primary care centres comprising of up to 10 centres.

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Permanent link | Comments | Categories: EducationFinanceHealthJusticeTransport

Labour delivers on personal debt reform

Posted on June 29, 2012

Minister Jan O'Sullivan - Minister Jan O'Sullivan at the launch of the Personal Insolvency Bill
Minister Jan O'Sullivan at the launch of the Personal Insolvency Bill

The launch of the Personal Insolvency Bill today marks another promise delivered by Labour. As committed to under the Programme for Government, the Personal Insolvency Bill offers constructive help to the many thousands of people who are struggling day to day with mortgage and personal debt.

While radically reducing the term of bankruptcy from twelve years to three, this Bill will provide for Debt Relief Notices for debts up to €20,000; and creates a Debt Settlement Arrangement and Personal Insolvency Arrangement which will allow homeowners to enter into an arrangement with banks in order to write down mortgage debt on a case by case basis. Altering the balance of powers, banks will now have to offer reasonable proposals to customers; otherwise the customer will have the option of bankruptcy.

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Permanent link | Comments | Categories: FinanceJan OSullivan

Government Takes Action on Mortgage Debt

Posted on June 26, 2012

Today the Tánaiste Eamon Gilmore confirmed that the cabinet has approved the publication of the Personal Insolvency Bill. The Bill which will be published this Friday, is part of the Government's Action on Mortgage Debt and outlined in the Programme for Government. It is just one of a series of measures which the Government is initiating to help those experiencing mortgage difficulties.

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Significant progress on Promissory notes welcomed

Posted on March 29, 2012

Today's announcement on the renegotiation around the payment on the promissory note has been called 'great news' by Labour's Deputy Ciara Conway.

"The opposition thought we would never be able to do this, but we have proved them wrong once again," Deputy Conway said.

You can read Deputy Conway's full statement in our media centre, and in the accompanying video you can see what Deputy John Lyons said about the development.

 

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Minister Brendan Howlin speaking about the Government's first year

Posted on March 13, 2012

Minister Brendan Howlin is the latest Labour minister to talk to us about the Government's first year in office, the work he has been doing and what is happening in the coming months. Watch what he said in the video.

The previous video from the Tánaiste Eamon Gilmore is available at this link and the video from Minister Kathleen Lynch at this link, Minister Joe Costello at this link and Minister Ruairi Quinn at this link. Do check back over the coming days for the next videos.

Permanent link | Comments | Categories: FinanceBrendan Howlin

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