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€100m boost as Central Bank announces bigger profit than expected

The Central Bank’s profits for 2012 were higher than forecast in Budget 2013 – offering some relief for the State coffers.

The profits at Patrick Honohan's Central Bank were higher than the Budget had predicted.
The profits at Patrick Honohan's Central Bank were higher than the Budget had predicted.
Image: Laura Hutton/Photocall Ireland

THE CENTRAL BANK of Ireland has returned nearly €1.15 billion to the taxpayer’s coffers – over €100 million more than had been originally expected.

The bank’s annual report for 2012 reveals surplus income of €1,147,600,000, which will now be returned to the Exchequer to be incorporated into the Budget.

It made a total profit of €1.4 billion, with the remainder returned to its operating budget for 2013.

The profits are significantly higher than had been anticipated – in December, when the Government compiled its first Budget estimates, it had expected €1.04 billion to be handed over.

The extra returns mean the Government will have slightly more breathing room in managing the country’s finances, with just over €100 million more coming in than had been expected.

The savings are unlikely to be used to ease the Government’s austerity plans, however, as the savings would likely be used to instead reduce the amount Ireland must borrow from international lenders, or be used to repay existing national debts.

The liquidation of IBRC and the arrangement regarding its promissory notes does not feature in the report, as it took place in early 2013.

Central Bank governor Patrick Honohan, discussing the report, said the bank’s two dominant activities for 2012 related to the management of IBRC’s liquidity and progress on dealing with mortgage arrears – both of which had reached a climax in 2013, with the introduction of mortgage resolution guidelines for banks.

“All of these measures are ultimately concerned with creating the environment for sustainable economic growth and reduction in unemployment,” he said.

The bank also issued 352 million banknotes and 185 million coins through its mint in Sandyford – both increased in the numbers minted in 2011.

Read: Central Bank regulator: Half of small business loans are impaired

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Gavan Reilly

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