€7.5bn Available To Exchequer

Imposing losses on junior bondholders in Irish banks has saved €7.5bn, it has been revealed.

Speaking before the Joint Oireachtas Committee,John Corrigan, the head of the Nation Treasury Management Agency (NTMA), said the funds can now be re-diverted towards helping to run the country until 2013.

Mr Corrigan said: "Stress tests carried out by the Central Bank in March 2011 had quantified the additional capital support required by the banking sector at €24bn."

"NTMA had worked hard to minimise the amount of this additional capital to be provided by the taxpayer," he added.

It is understood that through initiatives like burden sharing with the junior bondholders and the sourcing of private capital for Bank of Ireland, the net amount of this capital provided by the State is now expected to be around €16.5bn

Mr Corrigan said: "The savings generated can be redirected to funding the day-to-day operation of the country. This means that €68.5bn of the total €85bn funding under the (EU/IMF bailout) Programme is available to the Exchequer – an amount sufficient to meet our funding needs through to late 2013."

The meeting was held today in the interest of Ireland's economic and banking system.

The Oireachtas Committee met with both The National Assests Management Agency (NAMA) and NTMA.

The committee has secured a series of meetings with the main players in the field of domestic and European finance.

The purpose of these sessions is to give the members of the Joint Committee an overview of the major issues that are facing the Irish economy and the banking sector.

Over the coming weeks, the Committee will continue its rigorous consultation process with all the main players in the field of domestic and European finance. The Minister for Public Expenditure and Reform, Brendan Howlin TD, and the heads of Bank of Ireland and AIB will also attend upcoming meetings.

The committee has already met with The Irish Central Bank Governor, Patrick Honohan and the Mininster of Finance, Michael Noonan.

(LB/CD)