Updated, 21:28

THE DÁIL is to sit late tonight to deal with emergency legislation to liquidate the Irish Bank Resolution Corporation – transferring its assets to the National Asset Management Agency.

The government’s chief whip Paul Kehoe told TheJournal.ie that the Dáil would convene at “10 or 10:30pm” to debate the legislation, which forms part of moves to conclude a deal with the European Central Bank that would replace IBRC’s promissory notes with long-term government bonds.

TDs voted this evening to extend the working today, reconvening at 10:30pm with a vote on the legislation – the IBRC Resolution Bill 2013 – at around 12:40am.

The Seanad will then debate the legislation overnight, with President Higgins interrupting a trip to Italy to be available to sign any legislation.

Staff at IBRC were told this evening that the bank would be going into liquidation under the control of KPMG, while its chairman Alan Dukes said the board had been stood down with figures from KPMG now in direct control of the institution.

Members of the ECB’s governing board are meeting informally in Frankfurt this evening, ahead of an official board meeting tomorrow – with the Irish member, Central Bank governor Patrick Honohan, reported to be ‘pitching’ the bonds-for-notes swap at that dinner.

Approval from the 21-member board, led by ECB president Mario Draghi, was then expected to be rubber-stamped at tomorrow’s meeting and finally approve the deal.

However, it now appears that the ECB is keen not to be rushed into the deal – meaning that while the legislation could be considered by the Oireachtas, a final deal may not be completely signed off on tomorrow. Including tomorrow, the ECB will only meet four times between now and March 31 when the next €3.06 billion promissory note repayment is due.

The proposed deal would see the promissory note replaced with a package of government bonds, each of which would mature at different times in the coming decades. The bonds would have maturities of between 25 and 40 years, with an average maturity of 27 years.

Turning bank debt to sovereign – and extending the deadline

Extending the repayment period would mean that while the debts would take longer to clear, their overall value would be reduced by inflation.

Crucially, it would also avert the need to make annual repayments on the promissory notes every year until 2031, which are required under the current system. Last year’s repayment was made by issuing a new government bond which will mature later this year.

The Department of Finance would not immediately comment on the nature of the legislation that politicians have been told to expect. Ironically, the Dáil will this evening debate a motion from the Technical Group which calls for the government to default on the next €3.06 billion repayment.

While most of IBRC’s deposit book has been transferred to AIB, its most recent accounts from June 2012 showed surviving deposits of €518 million – including €11 million repayable on demand and another €507 million lodged by customers with agreed maturity dates.

Though the bank has been reducing its workforce since it came into effect in mid-2011, it still had 1,031 employees as of last summer.

The promissory notes were issued by the Irish Government to IBRC so that it could access emergency funding from the Irish central bank at the height of the banking crisis. IBRC makes annual repayments on the note every March 31 – repayments which must be funded by the taxpayer, given that IBRC is 100 per cent state-owned.

Read: Everything you need to know about the promissory notes, but were afraid to ask