Cost of bailout falls to €40bn from initial €64bn
Published 05/08/2014 | 02:30
The cost of Ireland's bank bailout to the taxpayer has fallen by almost €25bn, new figures obtained by the Irish Independent reveal.
The cost to the taxpayer of rescuing the banks is now around €40bn compared with the initial €64bn bill.
The Government was forced to seek aid from the EU, European Central Bank and the International Monetary Fund to stave off bankruptcy in 2010 as it struggled with the mounting cost of propping up the banks.
Newly released figures show that the bailed-out banks have so far paid €4.3bn in fees to the State in return for the benefit of the guarantee.
This is made up of €3.5bn of fees paid by the banks for cover under the Eligible Liability Guarantee, which is to remain in place until 2018.
The banks covered by the guarantee are: AIB (€1.23bn), Bank of Ireland (€1.25bn), Irish Life and Permanent (€556m), EBS (€205m) and the IBRC (€259m).
On top of the €3.5bn, another €758m was paid by the banks to the State to cover the cost of the initial guarantee between 2008 and 2011.
When added to the €6bn received by the State from the sale of bank assets and the €13.1bn valuation of the State's holdings in the banks, the net cost of the bailout is now €40.6bn.
That figure is theoretical; the State has not tried to liquidate its stake in the two banks which means that it does not really know how much they are worth.
The cost of the bailout is likely to fall further in the future as Allied Irish Banks starts to repay the money it was loaned by the State and the National Asset Management Agency pays further dividends to the State.
The taxpayer has already made a paper profit on the rescue of Bank of Ireland.
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