Related News
Ireland faces 'horrendous' bank bill
Source: Agencies |
September 30, 2010, Thursday
|
Online Edition
Online Edition
Ireland disclosed a mammoth "final" price tag of nearly 40 billion euros (US$54.33 billion) yesterday for bailing out its distressed banks and said it would have to make more drastic budget savings.
Ireland's central bank estimated the worst case cost of winding down nationalized Anglo Irish Bank at 34 billion euros and Prime Minister Brian Cowen's battered government said it would have to inject 5.4 billion euros more in taxpayers' money into Irish Nationwide building society.
The euro slipped against the dollar as traders took stock of the impact on a country that was once the EU's fastest-growing economy but will now be shackled by a public debt burden of nearly 99 percent of gross domestic product.
But overall, financial markets reacted calmly, assuaged by the fact that Moody's does not now expect to cut Spain's debt rating further while traders said a bill of up to 35 billion euros for Anglo Irish had been priced in.
A copy of the Spanish budget, obtained by Reuters, showed the government aims to cut its net debt issuance in 2011 to 43.3 billion euros from the 76.2 billion originally planned for 2010.
Finance Minister Brian Lenihan said the bill for Ireland's banking crisis was "horrendous" but it brought to a close the public's response to the disaster.
He said the state would also probably take a majority stake in Allied Irish Banks, which needs an extra 3 billion euros in capital by the end of the year.
The level of state support for the banking system remained "manageable," he said, even though it will push the 2010 deficit up to an unprecedented 32 percent of gross domestic product -- more than 10 times the European Union's ceiling.
The huge bill for Anglo was well above Dublin's previous official estimate of 25 billion euros but in line with a 35 billion euro worst case scenario by Standard's and Poor.
Ireland's central bank estimated the worst case cost of winding down nationalized Anglo Irish Bank at 34 billion euros and Prime Minister Brian Cowen's battered government said it would have to inject 5.4 billion euros more in taxpayers' money into Irish Nationwide building society.
The euro slipped against the dollar as traders took stock of the impact on a country that was once the EU's fastest-growing economy but will now be shackled by a public debt burden of nearly 99 percent of gross domestic product.
But overall, financial markets reacted calmly, assuaged by the fact that Moody's does not now expect to cut Spain's debt rating further while traders said a bill of up to 35 billion euros for Anglo Irish had been priced in.
A copy of the Spanish budget, obtained by Reuters, showed the government aims to cut its net debt issuance in 2011 to 43.3 billion euros from the 76.2 billion originally planned for 2010.
Finance Minister Brian Lenihan said the bill for Ireland's banking crisis was "horrendous" but it brought to a close the public's response to the disaster.
He said the state would also probably take a majority stake in Allied Irish Banks, which needs an extra 3 billion euros in capital by the end of the year.
The level of state support for the banking system remained "manageable," he said, even though it will push the 2010 deficit up to an unprecedented 32 percent of gross domestic product -- more than 10 times the European Union's ceiling.
The huge bill for Anglo was well above Dublin's previous official estimate of 25 billion euros but in line with a 35 billion euro worst case scenario by Standard's and Poor.
- About Us
- |
- Terms of Use
- |
-
RSS - |
- Privacy Policy
- |
- Contact Us
- |
- Shanghai Call Center: 962288
- |
- Tip-off hotline: 52920043
- 沪ICP证：沪ICP备05050403号-1
- |
- 互联网新闻信息服务许可证：31120180004
- |
- 网络视听许可证：0909346
- |
- 广播电视节目制作许可证：沪字第354号
- |
- 增值电信业务经营许可证：沪B2-20120012
Copyright © 1999- Shanghai Daily. All rights reserved.Preferably viewed with Internet Explorer 8 or newer browsers.
