Banking

Revealed: Government officials ‘hugely surprised’ by regulator’s PTSB dividend move

The department memo also warned that Irish lenders’ bumper profits were likely to be short-lived

Department of Finance officials said that PTSB was yet to prove it could generate enough capital to pay out to shareholders while growing and reinvesting in its business. Picture: Sam Boal

The removal of crisis-era restrictions on PTSB paying dividends to its shareholders last year was a “huge surprise” to the Department of Finance, internal records reveal.

In a memo sent to Michael McGrath and seen by the Business Post, departmental officials show the finance minister’s officials were caught on the hop by the regulator’s decision to remove the so-called dividend blocker for the first time since the crash.

Eamonn Crowley, the chief executive at PTSB, last month said the bank was likely to wait another two years before returning to dividend payments, after it posted profits of €166 million.