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Monday 15 September 2014

We do not want to pay €3.1bn Anglo debt next year, insists Noonan

Fiach Kelly Brussels

Published 13/11/2012 | 05:00

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Finance Minister Michael Noonan chatting with ECB President Mario Draghi in Brussels yesterday while IMF Managing Director Christine Lagarde looks on.

FINANCE Minister Michael Noonan is insisting the Government does not want to pay the next €3.1bn tranche of Anglo-Irish Bank debt due next year.

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Mr Noonan refused to rule out a deal on the promissory notes ahead of next month's Budget, even though the prospect is highly unlikely.

He is in Brussels for a meeting of eurozone finance ministers, but the main focus is on solving the ongoing crisis in Greece. A deal on Ireland's bank debt was not discussed last night, and Mr Noonan denied the Greek situation was delaying a deal for Ireland.

Talks are ongoing with the European Central Bank (ECB) on the Anglo-Irish promissory notes, as well as separate negotiations on a possible retrospective recapitalisation of Irish banks using the European Stability Mechanism (ESM).

Mr Noonan said the Government does not want to pay the next instalment of the Anglo-Irish promissory note, with €3.1bn due next March.

"We didn't pay it last year and we don't want to pay it this year, so we would certainly need an agreement in advance of that."

He also said he did not want to completely shut off the idea of securing a deal on the promissory notes in advance of the Budget, but this was unlikely.

"Well, I don't want to close off anything by saying 'no'," Mr Noonan added. "I'm pushing to get an agreement as quickly as I may get that agreement and I don't want to close off any options."

He said the Government hoped to push these issues on during Ireland's presidency of the European Council, which begins in January.

"I don't think the Greek issue is inhibiting our talks with the ECB in any way whatsoever," Mr Noonan added.

"And in terms of the ESM, possibly directly recapitalising banks, well the prior condition on that is the Euro banking union supervisory mechanism would be in place.

"That would be our priority in the presidency to drive that so it is in place for the first couple of months of the year."

The Greek parliament recently approved further austerity measures, and Greece says it will start to run out of money on Friday.


However, EU economic commissioner Olli Rehn last night said funding will not be a problem by Friday. When asked if there would debt writedown for Greece outside of the private sector, Mr Noonan said he would wait and see what proposals were brought forward and would react to them.

Differences have emerged between the EU and the IMF on the issue of public debt write down, with Jean-Claude Juncker, president of the eurogroup, ruling it out, but IMF chief Christine Lagarde saying everything is on the table.

Mr Noonan was also asked if a deal on the promissory notes was tied to shutting down the Irish Bank Resolution Corporation (IBRC), formerly Anglo, but would only say the Government had been talking to the ECB for "some time".

And he added Ireland wanted to put "flesh on the bones" of the June European council meeting which committed to jobs and growth before it assumes the EU presidency.

"The theme of the Irish presidency is jobs and growth and that's building on the commitments in the council meeting on ,June 29, where Europe committed itself to a jobs and growth programme in addition to fiscal corrections.

"So what we'll want now even before our presidency, is flesh put on the bones of the commitments of the June council in respect of jobs and growth."

Irish Independent

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