Peter Morrison/AP
Bank Guarantee

Central Bank reveals full extent of banks' bond liabilities

The Central Bank decides, on a ‘once-off’ basis, to tell us that Ireland’s banks owe bondholders a total of €63.4 billion.

IRELAND’S CENTRAL BANK has published details of the exact amounts owed to investors by the six Irish banks covered by the government bank guarantee – revealing liabilities of €63.4 billion.

The figures – concerning state-owned AIB, Anglo Irish Bank, Irish Nationwide and EBS, as well as Bank of Ireland and Irish Life & Permanent – were published by the bank apparently without notice, saying they were published in the interests of providing public information.

The timing of the release, however, is more probably to provide context to the Fine Gael and Labour negotiating teams as they continue negotiations on a potential programme for government.

The figures showed that the the banks had over €20.9 billion in senior bonds which were covered under the state guarantee, with figures dating from February 18.

Banks had a further €19.1 billion in unguaranteed, but secured senior bonds. Another €16.4 billion was owed in unsecured and unguaranteed bonds.

Subordinated bonds – which, to date, have been the subject of most of the discussions about burdensharing – account for €6.9 billion, a relatively small portion of the overall liabilities of €63.385 billion.

Such bonds typically have a higher payout, with investors rewarded for putting their cash into bonds that carry a lesser guarantee of repayment.

Bank of Ireland had the greatest outstanding liabilities, with €6.178 billion in guaranteed senior bonds, and over €17.4bn in unguaranteed senior bonds between both the secured and unsecured categories.

Irish Life & Permanent – the only one of the institutions covered which has not received a public recapitalisation since the guarantee was introduced – has total obligations of €10.062 billion, while Anglo’s outstanding requirement totals €6.255.

EBS, which is to be sold off to a private consortium led by American billionaire Wilbur Ross, has comparatively paltry obligations of €2.612 billion.

AIB’s obligations total €17.301 billion, with €2.6 billion of that owed to subordinated ‘junior’ bondholders.

Irish Nationwide, which like Anglo is being wound down, has no guaranteed bondholders, with €601m in unsecured senior bonds and €175m owed to subordinated bondholders.