BoI to vote next month on €3bn Anglo bailout loan
Shareholders expected to approve deal
BANK of Ireland shareholders will finally vote next month on whether to lend €3.06bn to the Government to help meet the cost of the controversial Anglo Irish Bank "promissory note".
In March, the board of Bank of Ireland agreed to make the loan so that the Government could meet the first payment due under the controversial "promissory note" used to bail out Anglo Irish Bank.
The loan was part of Finance Minister Michael Noonan's scheme to repay the controversial instalment without dipping into the annual budget, after EU authorities rejected pleas to postpone the payment.
However, the loan has yet to be made. Despite board approval, the deal must be backed by the bank's shareholders at an extraordinary general meeting. That's because the State, as a borrower, is considered a "related party" under banking rules because it is a shareholder in the bank.
When the payment fell due on March 31, Mr Noonan ordered the National Asset Management Agency to make the payment. NAMA paid the Anglo Irish Bank instalment out of its €4.3bn cash pool, pending Bank of Ireland approval to take over the loan.
The temporary NAMA loan was due to expire yesterday, before any date had been set for the Bank of Ireland EGM. NAMA then extended the facility yesterday until June 20, piling pressure on Bank of Ireland to approve the deal.
Last night the bank said the vote would go ahead on June 18. It said it had been impossible to call the meeting earlier because it needed regulatory approval before putting the deal to a vote.
Despite the delay in calling the meeting, shareholders are expected to approve the deal, which has the backing of the board of directors.
They said last night that Bank of Ireland will make a profit of €38.7m on the loan, and that any costs of the facility will fall on Irish Banking Resolution Corporation, the former Anglo Irish Bank.
The bank also said it stands to benefit indirectly from the positive impact on the economy of meeting the payment.
The Government has guaranteed to repay the loan.
Meanwhile, NAMA could be forced to publish pictures and prices for the seized assets being sold by the bad bank.
Fianna Fail senator Mark Daly has tabled a private members bill to force NAMA to include pictures and prices for the €1bn of assets it has taken into receivership on its website.