Recapitalisations of AIB, Bank of Ireland and EBS

The Minister for Finance today announced that the Government is postponing further capital injections in Allied Irish Banks, Bank of Ireland and the Educational Building Society until after the upcoming election on February 25.

The Government is doing so to allow the election to take place before the necessary injections are made by a newly elected Government. Under the EU/IMF Programme of Financial Support, the Irish authorities agreed to ensure that Allied Irish Banks, Bank of Ireland and the Educational Building Society would be initially capitalised to a level of 12% Core Tier 1 capital.

This was to be completed by the end of February. However, the Minister has informed the European Commission, the IMF and the ECB of the Government’s view that, because of the democratic process, this issue should be addressed by the incoming Government. Even without further capital injections these banks are adequately capitalised and the short delay poses no regulatory or stability issues.

Ends

9th February 2011

 

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