Bank sales to be easier as Government deal extended
Finance Minister Paschal Donohoe is now free to sell off as much of Ireland's bailed-out banks as he likes, it has emerged.
The Programme for Government had limited Mr Donohoe to selling off no more than 25pc of a bailed-out bank before the end of 2018.
However, the Irish Independent understands that the provision that tied the minister's hands was not renewed when the Confidence and Supply deal keeping Fine Gael in office was extended.
Taxpayers own 71pc of AIB, 14pc of Bank of Ireland and 75pc of Permanent TSB.
Earlier this year, the Government sought to bring in advisers to help devise a strategy for selling those shares.
But no share sale took place and some €4bn has been wiped off the cumulative value of those holdings this year, with markets bruised by the US-China trade dispute and Brexit uncertainty.
At home, banks are also facing challenges, with growth in the Irish economy expected to be slower in 2019.
The housing crisis is hampering banks' ability to grow their revenues by lending more mortgages, as houses aren't being built fast enough to meet demand.
In addition, analysts say the Central Bank limits on the amount which mortgage hunters can borrow are also having an impact on banks' growth.
Though the State will not see a return of the cash pumped into Anglo Irish Bank and Irish Nationwide, it hopes to recoup and even make a profit on the money invested to save AIB, Bank of Ireland and Permanent TSB.
But the fall in bank shares seen this year has made the prospect of recovering the money more distant.
A Department of Finance spokesman said earlier this month that officials continue to monitor the markets with a view to a sale.
The Government's plan is to use any proceeds to pay down the national debt.