Assets move dismissed

The Department of Finance has no plans to change the status of deferred tax assets even though it could greatly boost the value of AIB and, to a lesser extent, Permanent TSB.

AIB is holding €3.3bn in deferred tax assets, which are written off against future losses over the next number of years. Other eurozone periphery countries such as Spain have changed the status of deferred tax assets to deferred tax credits.

Market sources said the Government should follow the Spanish example as it would enhance the value of AIB in particular. In the event AIB was liquidated, then the value of outstanding deferred tax assets on its balance sheet would be worthless.