Anglo debt is STILL not our debt
02 May 2014
Newsdesks
Anglo debt is STILL not our debt
In the wake of the Anglo trial, campaigners renew call that sale of Anglo bonds be frozen
Debt Justice Action – a coalition of community, trade union, global justice, academic, faith-based and other groups that hosts the Anglo: Not Our Debt Campaign – today renewed its call that the sale of bonds issued to replace the Anglo promissory notes be frozen, and a full write down of this debt be negotiated with the ECB.
Campaign spokesperson Niamh McCrea, said:
‘The focus on regulatory failure following the Anglo trial verdict should not distract us from the fact that almost € 30 billion of socialised Anglo debt is the result of this failure, and is still to be repaid by the people of Ireland.'
Ms McCrea added:
‘This debt is the debt of gambling bankers. It represents almost half of the overall socialised banking debt being paid by people in Ireland. The proposed sale of the Anglo bonds on international markets should be frozen pending a full cancellation of this illegitimate debt."
Vicky Donnelly of the campaign said,
"The Irish Central Bank Governor, Patrick Honohan, has the power to halt the sale of the Anglo bonds on international markets in order to support the negotiation of a full write down of this debt with the ECB. We call on Governor Honohan to do the right thing and freeze the sale of these illegitimate bonds. If the bonds are sold on the markets, securing cancellation will become more difficult. Governor Honohan must do the right thing and freeze their sale."
end
For interviews contact
Niamh McCrea: Carlow IT / Attac Ireland: 087 2458140
Vicky Donnelly: Debt Justice Action Galway: 087 2645344
Nessa Ni Chasaide: Debt and Development Coalition Ireland 087 7507001
Notes to the editor
- The Anglo Not Our debt Campaign objects to the Anglo debt and its conversion from promissory notes into bonds on the following grounds:
- The Anglo debt debt is the debt of gambling bankers. It represents almost half of the overall socialised banking debt being paid by people in Ireland. It is not our debt and we should not pay any of it. While the deal lengthens the payment period (to 39 years instead of the original 17 years), the converting of the promissory notes into bonds means the government believes that the Anglo debt is a legitimate debt that should be paid. It shouldn't.
- The government has now made it more difficult not to pay this debt. The promissory notes were basically an inter-agency promise between state agencies – the Irish government, Anglo (state owned) and the Irish Central Bank. They could have decided between them not to pay it, or at least negotiated hard with the ECB for agreement not to pay it. By changing the debt into bonds, the debt will now be traded internationally and we will owe it to private bondholders instead – who will of course put up a serious fight if they are not paid
- Selling all €25 billion worth of Anglo bonds would increase our annual debt interest payments by around €1 billion each year. By trading the debt on the private markets, the Irish Central Bank will have to pay interest to private bondholders, rather than keep the interest payments within the state system. The bonds will carry a floating interest rate so we don’t know exactly how much they will cost us. But once they are all sold it’s likely that the annual interest bill will be over € 1.3 billion– not even counting the principal on the maturing debt
- The Schedule for the sale of the Anglo bonds is:
2013 to 2017: € 0.5bn per year
2018 to 2022: € 1bn per year
2023 to 2030: € 2bn per year
2031: € 1.5bn
Source: CBI & NTMA, Exchange Option Deed, 28th March 2013
- For information on the Anglo: Not Our Debt Campaign asking Governor Honohan to Freeze the Sale of the Anglo Bonds see here
