Time, options running out on €30bn deal

If the Government secures a deal with the ECB on the promissory notes, it will only provide funding relief over the near term, but it will not lead to any savings on the bank debt.

News reports over the weekend appeared to scupper the Government’s chances of securing a deal on the restructuring the €30bn in promissory notes issued to cover the losses in Anglo Irish Bank. It is believed that a deal can still be struck before the next payment is due at the end of March, but it will fall well short of what the Government had been hoping for.

The then minister for finance, Brian Lenihan, issued €30bn of promissory notes in March 2010 to cover the staggering losses in Anglo. The agreement was that the Government would pay IBRC, which is now responsible for running down the operations of Anglo Irish Bank, €3.1bn every March until 2023. The IBRC gives this €3.1bn to the Irish Central Bank. The Central Bank deducts this from the amount it owes the ECB under the emergency liquidity assistance programme.