Saturday 25 January 2020

Irish officials still hopeful of delaying €3.1bn Anglo payout

Laura Noonan and Sarah Collins

IRISH officials are still hoping to be able to postpone a €3.1bn payment due to the former Anglo Irish Bank at the end of March -- even though the EU's economics chief Olli Rehn yesterday appeared to indicate he would not support any such concession.

Mr Rehn was asked about the prospect of delaying the March payment by reporters in Brussels yesterday and responded by telling them "the principle in the European Union is, in Latin, 'pacta sunt servanda' -- respect your commitments and your obligations".

"The European Union is a community of law and that assumes by definition that each and every member state respects the commitments it has undertaken -- this is valid in the case of Ireland as well," he said.

Some interpreted his comments as indicating his lack of support for delaying the March payment.

But others said he had not ruled out Ireland reaching an agreement with creditors to change its commitments.

Sources close to the process last night stressed that things "hadn't changed" from Monday when Finance Minister Michael Noonan said he "wasn't including or excluding anything" on the imminent payment since "it's a long way to the end of March".


It is understood that the Irish authorities will continue to push for a postponement of the March payment, but are likely to direct most of their energies towards negotiations with the European Central Bank, which is the key decision-maker for any postponement.

Some sources said the postponement of the March payment might not even need approval from the European Commission since it could be structured in a way that would not require any additional support from Brussels.

The ECB's support is crucial since the Government wants to change the terms of the €31bn IOU it used to bail out Anglo -- an IOU which is now used as collateral for the bank's borrowings from the Central Bank.

Central Bank governor Patrick Honohan may raise the issue with his fellow governors at a meeting on March 22.

The ECB/IMF/EC troika is also working on proposals for a wider restructuring of Anglo Irish Bank's bailout.

Some reports have suggested that the work is nearing completion, but some sources said it may take months to finalise proposals.

Mr Rehn yesterday said the March payment was a "separate issue" from "any possible negotiation on a medium and long-term solution", indicating there was still a chance Ireland would be given a reprieve on the expensive bailout of the former Anglo Irish Bank,.

Mr Noonan indicated yesterday that he had brought up the issue at a meeting of eurozone finance ministers on Monday night, which was attended by European Central Bank President Mario Draghi.

While insisting that it was not a "formal agenda item", he said he brought the issue up in "bilaterals all the time".

However, he stressed that the negotiations were taking place "at different levels" and could not confirm whether a decision would be reached by the time finance ministers reunited for more talks in Copenhagen at the end of the month.

"That has been subcontracted to a technical group and it doesn't come up as an agenda item," he said.

Irish Independent

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