Allied Irish Banks (AIB)

[primarywatcher]

2/1/11: Ireland submits Anglo Irish, Irish Nationwide plans

http://www.reuters.com/article/2011/02/01/uk-ireland-banks-idUKTRE71034Y20110201

(Reuters) - Ireland submitted restructuring plans for state-run Anglo Irish Bank ANGIB.UL and Irish Nationwide IRNBS.UL to the European Commission late on Monday, meeting its first major banking deadline under an IMF/EU bailout.

Dublin has pledged to radically restructure its troubled banks, at the root of its financial crisis, and was told to submit plans detailing how it would seek to minimise capital losses arising from the wind-down of the two "non-viable" institutions by the end of January.

A spokesman for the finance ministry confirmed on Tuesday that department officials had sent the plans to Brussels late on Monday night.

Ireland so far estimates that recapitalising nationalised Anglo Irish will cost the state between 29.3 and 34.3 billion euros (£25 and £29 billion) while it has already poured 5.4 billion euros into building society Irish Nationwide.

Officials have said they plan to transfer the deposit books of both banks to other lenders. Ireland's central bank governor said late last year that Anglo's loan book would then be wound down over a period of years.

Propping up Anglo Irish, hit by reckless lending and scandal, helped to push Ireland's already large budget deficit to an eye-watering 32 percent of gross domestic product (GDP) last year.

Under the terms of the EU/IMF agreement, Ireland will be given 35 billion euros for its banks, with 10 billion euros to be injected immediately and the remainder used as a backstop for any future losses arising out of property loans written during the go-go years of the "Celtic Tiger" economy.