Wednesday, 13 May 2009
Dáil Eireann Debate
81. Deputy Lucinda Creighton asked the Minister for Finance the reporting dates imposed on the covered banks in respect of credit information, the level of covered liabilities and the payment of insurance premium and of share coupons for the guarantee and recapitalisation; and if he is satisfied with the arrangements. [19061/09]
Minister for Finance (Deputy Brian Lenihan): Officials from my Department, the Department of Enterprise Trade and Employment, the Central Bank and the Financial Regulator are in regular contact with the banks regarding the flow of lending to small business and consumers. Under the Scheme, covered institutions have committed to submitting reports requested by the Regulatory Authority at my behest, including reports which monitor the flow of credit to the real economy. The reports will be submitted with such frequency and in such form as the Regulatory Authority determines.
With regard to credit commitments arising out of the recapitalisation, the banks have agreed to make quarterly reports to the Financial Regulator. The first reports to end March 2009 have been submitted to the Financial Regulator in accordance with the timeframe of end-April 2009.
Each covered institution must pay the charge quarterly, in advance, to the Minister, payable no later than five working days after the beginning of each quarter, during the period the covered institution avails itself of a guarantee. This charge is based on the monthly average of total covered liabilities. Arising from this, the covered institutions must submit monthly covered liabilities reports to the Financial Regulator. These returns have had to be submitted to the Financial Regulator no later than the 6th working days following month end. However, I understand that the future returns will be incorporated into the Monthly Summary Financial Report which is received by the Regulator no later than the 20th working day following month end.
Finally in relation to the payment of the coupon under the recapitalisation, the fixed dividend of 8% is payable annually. Dividends are payable in cash at the discretion of the bank. If a cash dividend is not paid, then ordinary shares are issued in lieu at a time no later than the date on which the bank subsequently pays a cash dividend on other Core Tier 1 capital.
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