Central Bank sells €500m of bonds linked to Anglo bailout

Bonds being sold down at a much faster rate than expected under 2013 agreement

The Central Bank has sold a further €500 million of bonds linked to the bailout of Anglo Irish Bank, bringing total disposals so far to €3.5 billion.

The securities are the result of the Central Bank receiving €25 billion of government bonds three years ago under a complex restructuring of promissory notes used by the State during the crisis to rescue the bank.

When the Irish Bank Resolution Corporation (IBRC), as Anglo Irish was renamed, was put into liquidation in 2013, the promissory notes were being used by the failed bank as collateral for emergency Central Bank funding.

The Central Bank has been selling down the bonds at a much faster rate than it is obliged to do under the original 2013 agreement.

It disposed of €500 million of a 2041 floating rate government bond to the National Treasury Management Agency yesterday, which duly cancelled them.

Some €21.5 billion of the government bonds remain on the Central Bank’s balance sheet after the transaction.

Joe Brennan

Joe Brennan

Joe Brennan is Markets Correspondent of The Irish Times