State set for €275m IBRC liquidation payout

The State is due to receive a €275m payout from the liquidation of the IBRC by the end of the year.

The latest update on the liquidation of IBRC — formed from the embers of Anglo and Irish Nationwide — shows that the special liquidators now expect to pay an interim dividend of 25% to unsecured creditors before the close of the year.

Among the list of unsecured creditors is the State which is owed €1.1bn.

The first payment to unsecured creditors is due to be made in the coming months meaning a range of bodies including local authorities, credit unions and the State are set to receive a cheque by the turn of the year.

The liquidators Eamonn Richardson and Ciaran Wallace of KPMG now expect to be able to pay unsecured creditors 75%-100% of their claims.

It is understood the unsecured creditor payouts are likely to be made in full however, which would open the door for junior bondholders who have submitted claims worth about €285m.

While the liquidators said they do not anticipate making payments to subordinated, or junior, bondholders the larger-than-anticipated €2.23bn surplus and the likelihood of the unsecured creditors’ claims being met in full means bondholders may yet be in line for a multi-million euro payout.

Subordinated bondholders would be entitled to payment once there are proceeds of the liquidation left over after 100% of all admitted claims made by unsecured creditors have been paid.

Finance Minister Michael Noonan said the exact scale of the eventual payout to unsecured creditors was still unknown as a number of factors had yet to be finalised.

“The special liquidators inform me that they hope to be in a position to make an interim distribution by 31 December, 2016 of 25% of all admitted claims made by unsecured creditors.

Their expectation is that the eventual unsecured creditor dividend will be in the range of 75% to 100% of all eligible claims.

“The special liquidators further advise me that this eventual dividend range is subject to change depending on future events which are outside the control of the special liquidators.

“The ultimate level of dividend paid to each creditor cannot be known until such time as all loan assets are sold, the total level of adjudicated creditors is finalised and the other contingent creditor claims which may crystallise, including those from litigation, are known,” Mr Noonan said.

The €2.23bn surplus represents a further increase on the last-reported €1.85bn surplus which emerged last year. Mr Noonan said he was pleased with the progress made by the liquidators.

A number of tasks remain to be completed including hundreds of ongoing legal cases which are yet to be resolved, he said.

“There remains a number of tasks in the liquidation to be completed including the ongoing management of over 350 legal cases which has reduced from circa 700 cases since March 2015, the completion of the creditor adjudication process, the work with the Commission of Investigation, the management of the remaining loan book of circa €3.7bn and the realisation of all remaining assets.

“I am confident the special liquidators will deliver on these and all remaining tasks.

“I am satisfied with the financial outcome of the liquidation to date which has far exceeded our expectations and has not resulted in any further cost to the Irish taxpayer,” Mr Noonan said.