Don't miss

Replay


LATEST SHOWS

EYE ON AFRICA

Seven African countries' economies at risk over Brexit decision

Read more

THE DEBATE

Britain votes out: What next?

Read more

#TECH 24

The 'fintech' revolution

Read more

FRANCE IN FOCUS

A certified 'palace': How hotels strive for excellence

Read more

#THE 51%

In her own image: Women in Art

Read more

REPORTERS

World War I: When northern France was on German time

Read more

REVISITED

Video: Ugandan city still scarred by Lord's Resistance Army atrocities

Read more

MEDIAWATCH

#Brexit sparks a storm on social media

Read more

BUSINESS DAILY

Markets, pound plunge on Brexit vote

Read more

Europe

Irish banks need further €24 billion

Text by News Wires

Latest update : 2011-04-01

The Central Bank of Ireland revealed Thursday that four banks require a further cash injection to the tune of 24 billion euros. After this latest bailout, the Irish government will have injected 70 billion euros into its flailing banking sector.

AFP- Four Irish banks require a new state bailout totalling 24 billion euros ($34 billion), the Central Bank of Ireland said Thursday after carrying out stress tests on their capital and liquidity.

"Collectively the four banks will be required to raise 24 billion euros in capital," said a statement giving the results of tests on Allied Irish Banks, Bank of Ireland, Educational Building Society and Irish Life & Permanent.

The additional capital would be covered by the 35 billion euros provided for the banks as part of Ireland's huge 85-billion-euro debt rescue agreed late last year with the European Union and the International Monetary Fund.

Following the latest cash injection, the Irish government will have pumped almost 70 billion euros into its battered banking sector since the start of the global financial crisis in 2008.

The Central Bank added in its Financial Measures Programme report that the four lenders would also be required to run down and dispose of certain non-core assets.

"The Financial Measures Programme aims to create a sustainable Irish banking system through a process of recapitalisation, deleveraging and reorganisation," Central Bank Governor Patrick Honohan said.

"Banks will be capitalised as the additional capital requirements announced today provide for future loan losses over the course of the (next) three years on a scale that is unlikely to occur and an additional buffer for subsequent events."

The tests, a requirement of the 85-billion-euro ($115-billion) EU-IMF bailout, assessed capital and liquidity levels to determine whether the four lenders can withstand severe macro-economic shocks over the next three years.

"This work by the Central Bank was a key element of the Ireland's agreement with the EU-IMF Programme," Honohan said.

"The stress test criteria and the terms of reference for the diagnostic evaluation of bank assets were developed in consultation with the EC, ECB (European Central Bank) and IMF at the end of 2010, and these institutions have since monitored progress in the implementation of the programme."

Date created : 2011-03-31

COMMENT(S)