Decision due by May on further capitalisation in AIB and BoI 07/02/2010 - 10:41:07
The country's two main banks will be told by May how much captial they will need to satisfy the markets.
It is estimated AIB and Bank of Ireland will need a total of more than €7bn in support from the taxpayer.
Billions of euro in risky and defaulting loans will be transferred out of the banks to NAMA during the spring.
It is reported today that by May, the new Governor of the Central Bank Professor Patrick Honohan will have identified what level of capital AIB and Bank of Ireland will have to have in reserve to support the markets.
With private funding unlikely, the deficit in the banks will have to be filled by the Government.
JP Morgan has said AIB will need a capital injection of €4.5bn while €2.7bn would be needed by Bank of Ireland.
Such a level of state support will see an increased share in the banks for the taxpayer.
