THE Government expects to phase out its bank guarantee in the first quarter of next year, the Department of Finance said this morning.
It is “safer” to seek approval from the European Commission to extend the guarantee beyond the end of this year, Department of Finance secretary general John Moran said.
The guarantee covers deposits worth €100bn.
Mr Moran, the most senior official in the civil service, said a big step for 2013 would be “to get the banks off” the government guarantee.
The “right call is to get the banks off the guarantee and return them to profitability,” he said at a conference in Dublin.
He added that he doesn’t expect the government to have to pay the next Anglo Irish Bank promissory note instalment in March as it negotiates with European partners to ease the cost of the country’s legacy bank bailout.
The Government’s latest estimates include the payment in their calculations but the Government is trying to reach some sort of deal before March.