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Government announces Revised Promissory Notes Agreement

The Government today announced that legislation has been passed providing for the orderly wind-up of IBRC through the appointment of Special Liquidators to manage the process.

  • Existing funding arrangements with regard to the Promissory Notes between IBRC and the Central Bank of Ireland (CBI) unwind and the CBI becomes economic owner of the Promissory Notes which are exchanged for Government Bonds.
  • NAMA, through an SPV, has been directed to acquire the Exceptional Liquidity Assistance (ELA) Facility Deed and the associated floating charge over the other IBRC assets from the CBI, funding this purchase by the issuance of Government Guaranteed NAM bonds to the CBI
  • The other creditors of IBRC will receive payment to the extent there are excess assets in the company available.

The Promissory Notes will be replaced with a portfolio of Irish Government bonds.

The portfolio will comprise:

  • Three tranches of €2 billion each maturing after 25, 28 and 30 years
  • Three tranches of €3 billion each maturing after 32, 34 and 36 years
  • Two traches of €5 billion each maturing after 38 and 40 years

Announcing the deal in the Dáil today, Taoiseach Enda Kenny said:

What today shows is that the more Ireland is prepared to help itself, the more others will assist us along the difficult path we still have to travel.

It is a step forward in accelerating our path back to economic recovery and renewed job creation.

It can give us confidence that our goals are achievable, that our hopes are realisable.

It is important to recognise the independent efforts of the Irish Central Bank Governor, his staff and officials from the ECB in securing this agreement. I am confident that it will contribute hugely to the ongoing rebuilding of trust between Irish and European authorities in the management of the banking crisis.

Today’s result has been brought about a strong and determined collective effort by the entire Government. I want to thank the Tanaiste and all Ministers for their contribution to this outcome.

Most of all, I want to publicly thank the Minister for Finance Michael Noonan and his officials for leading these negotiations to a successful conclusion. Their dedicated service to the State in their tireless, persistent and patient work over the past 18th months should be an inspiration to us all.

Read the Taoiseach's full speech here.

Read the full overview of the deal (pdf file) here.