Thursday 22 August 2019

Olli Rehn rules out delay in €3.1bn Anglo repayment reporters

EU economics commissioner Olli Rehn has ruled out the possibility of a postponement of a €3.1bn Anglo debt repayment due at the end of this month.

However, he left the door open to the possibility of a rescheduling of Anglo, now IBRC, promissory note debt of over €30bn due to be repaid over the coming years.

The possibility of a delay in the €3.1bn payment had been mooted as part of a rescheduling of the promissory note, or IOU, debt used to recapitalise Anglo and Irish Nationwide which has crippling interest payments of an estimated €17bn attached to it.

The Government is in ongoing discussions with the EU/IMF/Troika in having this restructured.

If it is successful, this would mean a longer repayment time for the debt and a possible reduction in the interest rates.

“I actually wonder why this has to be asked at all because the principle in the European Union and in the long European legal and historical tradition is – in Latin – pacta sunt servanda, respect your commitments and obligations,” he said.

“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 and this is valid in the case of Ireland as well.

“Any possible negotiation on the medium- to long-term solution is a separate issue,” he added.

Taoiseach Enda Kenny insisted yesterday that negotiations are under way to restructure the terms of Ireland's European debt to make it easier on the nation in the longer term.

However he said they were difficult, complex and very technical.

"When you speak of the €3.1bn in respect of the promissory notes, I've made it perfectly clear we are not going to raise any undue expectations here," Mr Kenny added.

Finance Minister Michael Noonan confirmed earlier this week that Ireland is in negotiations with the troika to improve the terms of its €30bn promissory note.

But he insisted the negotiations are at an early stage and the results are therefore unlikely to take effect any time soon.

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