McGrath raises possibility of ending €150m levy on banks 

Consultation includes options for the levy, introduced nine years ago, to be 'extended, reformulated, broadened, or abolished'

A consultation launched by the Department of Finance will examine bank levy options. Picture: Laura Hutton

Finance Minister Michael McGrath has raised the possibility that the bank levy, which is supposed to raise €150m a year, will be abolished.      

That is one of the questions posed as part of a consultation launched by the Department of Finance that includes the possibility that the levy, first brought in nine years ago to help the State's coffers following the financial crash, "should be extended, reformulated, broadened, or abolished". 

The consultation comes after the department published a banking review late last year which also weighed competition in the market following the exits of major lenders Ulster Bank and KBC Bank.

Independent banking market experts as well as the competition regulator have long warned that consumers could likely lose out as the market becomes even more concentrated, with a small handful of big banks. 

Finance Minister Michael McGrath has raised the possibility that the bank levy will be abolished.  Picture: Sam Boal/Rollingnews.ie

Former finance minister Paschal Donohoe had also announced the lifting of many restrictions on banks paying staff bonuses. 

Separately, broker Goodbody has forecast that Irish banks are set for "further outsized returns ahead", helped by the increase in interest rates. 

Shares in AIB and Bank of Ireland, which had fallen sharply along with other European lenders in the past month, closed around 2.5% higher on Thursday.