Cash from loan sales 'will cover former bank's €12.9bn debt'
The cash raised from the recent sales of IBRC's billions of euro of loan assets is more than enough to cover the €12.9bn debt it owed to the Central Bank.
Under last year's complicated deal to liquidate IBRC and tear up the so-called Anglo Irish Bank "Promissory Note", the IBRC loans were to be sold off and the proceeds funnelled to the Central Bank through NAMA to part settle the former bank's debts.
Taxpayers were on the hook for any shortfall because state-owned NAMA had essentially guaranteed to pay the difference between cash raised from the sale and the money owed to the Central Bank. Any loans unsold by IBRC's liquidators were to be transferred to NAMA under the terms of the original liquidation.
Yesterday, the Department of Finance confirmed that the liquidation of IBRC had been so successful that none of its assets would now be transferred to NAMA.
Last year, the Government moved to wind up the former Anglo Irish Bank and appointed special liquidators to manage the closing of the bank.
As part of that process, NAMA effectively lent IBRC €12.9bn.
In return for what became known as the "promissory note transaction", IBRC had to sell off its loans, and use the takings to pay back NAMA.
The deal set alarm bells ringing at the time, because if the bank could not sell its loans, they would be transferred to NAMA. That could have increased the size of NAMA – and the burden on taxpayers – by as much as 50pc.
However, it has now emerged than none of the IBRC loans will go to the state bad bank.
In a statement, IBRC's liquidators Kieran Wallace and Eamonn Richardson said they expected the proceeds raised from the sale of IBRC assets so far would be "sufficient to fully repay the IBRC debt to NAMA".
Finance Minister Michael Noonan welcomed the news, calling it a "very successful outcome".
"All debt outstanding to NAMA as part of the promissory note transaction is now expected to be repaid in full.
"This means that no further assets will require transfer to NAMA, thereby finally breaking the link between the State and the former Anglo Irish Bank," he added.
The sale of what remained of IBRC's assets had set off a frenzy in the business community, as overseas investors queued up to buy out the loans, while some of Anglo's borrowers rushed to refinance their loans or to buy them themselves.