Brussels, 10/04/2015 (Agence Europe) - On Thursday 9 April, the European Commission gave the go-ahead to restructuring aid for Irish bank Permanent TSB.
The Commission says the restructuring plan sets out the path for PTSB to become viable in the long-term without further state support, while ensuring that the bank and its owners contribute to the cost of restructuring and limiting the distortions of competition created by the aid.
PTSB has received state support several times in the form of state guarantees since 2008. In July 2011, the Commission temporarily approved a recapitalisation of the bank by Ireland. Final approval of the aid was made subject to Ireland submitting an appropriate restructuring plan for the bank that needed to be approved under EU state aid rules. The initial plan submitted by Ireland was subsequently adjusted and updated several times to account for changing market conditions, the results of the October 2014 comprehensive assessment of major European banks by the Single Supervisory Mechanism, in order to agree terms to ensure the bank's long-term viability.
The restructuring plan includes a set of commitments that the bank will respect during the restructuring period, i.e. until the end of 2018. PTSB will continue to de-leverage and reduce costs and will not be able to carry out acquisitions in this period. Moreover, PTSB will take certain actions to facilitate the market entry of competitors. (Élodie Lamer)