Responding to a parliamentary question, Minister for Finance, Michael Noonan revealed that IBRCs unsecured creditors, including Irish pensions, will be exposed to losses.

Fine Gael and Labour are paying nameless bondholders, while at the same time wiping out Irish pensioners. By the end of last year, €22.3bn of the €22.5bn unguaranteed senior debt in Anglo Irish Bank and INBS had been paid by Irish citizens to international investors. Last month alone, we paid €933m in IBRC debts, which included unguaranteed bondholders. But at the same time, this government is imposing losses on citizens who were prudent enough to save.

The Minister has stated that the total value of Irish pension funds on deposit with IBRC at the time of liquidation was in the region of €1m. But this figure doesn’t include funds placed on deposit with the Bank in client accounts opened on behalf of beneficiaries, and therefore, fails to reveal the scale of the problem. It is unacceptable that the government can’t tell us how many pension funds are affected and by how much. I’m calling on the Government to ensure that pensions will be honoured. And to ensure that life savings won’t be destroyed, as a result of the madcap dash to liquidate the IBRC at 3am on February 7.

Below are the questions asked of Minister Noonan, on Tuesday, April 16 and his response.

  • To ask the Minister for Finance the total value of Irish pension funds on deposit, or in any other financial product, on the books of the Irish Bank Resolution Corporation at the time of liquidation under the Irish Bank Resolution Corporation Bill 2013; and if he will make a statement on the matter.
  • To ask the Minister for Finance the total write-down in the value of Irish pension funds due to the liquidation of the Irish Bank Resolution Corporation under the Irish Bank Resolution Corporation Bill 2013; and if he will make a statement on the matter.
  • To ask the Minister for Finance the number of individual pension funds, that is people, affected by the liquidation of the Irish Bank Resolution Corporation under the Irish Bank Resolution Corporation Bill 2013; and if he will make a statement on the matter.
  • To ask the Minister for Finance if he will publish the analysis done prior to the liquidation of the Irish Bank Resolution Corporation under the Irish Bank Resolution Corporation Bill 2013 on the effect of the liquidation on Irish pension funds held by IBRC; and if he will make a statement on the matter.

REPLY
I propose to answer questions 275, 276, 277 and 278 together.

As the Deputy is aware, I am not in a position to advise on the specifics of any accounts with IBRC (in liquidation). I have been informed that there are a number of customer accounts that may not be entitled to full compensation under the deposit guarantee scheme, DGS, or the eligible liabilities guarantee scheme, ELG, due to the nature of the products or deposit options in which those account holders invested. At the time that such products were offered there was no additional guarantee provided by the State in respect of those products. It was always the case that the ELG scheme covered only those liabilities which were entered into during the issuance window.

I have been advised that the total value of Irish pension funds placed on deposit with Irish Bank Resolution Corporation at the time of liquidation was in the region of €1m. This could exclude any funds placed on deposit with the Bank in client accounts opened on behalf of beneficiaries, where these beneficiaries are Irish pension funds. The total value of Irish pension fund deposits is currently under review with the respective Guarantee Scheme Operators, regarding consideration for payment under the respective schemes. The total number of individual pension funds with funds placed on deposit with Irish Bank Resolution Corporation at the time of liquidation was 23. Again, this could exclude any pension funds who are the beneficiaries of client accounts opened on their behalf.

Through the liquidation process, the proceeds from the disposal of IBRC’s assets will be used to repay creditors in accordance with normal Companies Acts priorities and consequently, preferred creditors will be paid first and then debt purchased by NAMA from the Central Bank will be paid. If there are proceeds available after repayment in full of the NAMA debt, these proceeds will be applied to remaining unsecured creditors. This would include depositors to the extent that their deposits are unguaranteed.