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Anglo Irish "needs €5.7bn" - 16-Nov-2009

Anglo Irish "needs €5.7bn new capital"

Anglo Irish Bank has told the government that it will need as much as 5.7bn euro in additional capital if it is to remain viable and resume lending, according to a weekend leak. The nationalised bank has already received 4bn euro from government funds. The Sunday Tribune reported yesterday that the bank said it needed the money to restore capital levels to international norms and to have a sufficient capital buffer against losses which can come from lending to the SME business sector.
The leak came as the Department of Finance continues to mull whether to run the bank down gradually or to relaunch it as a lender to small business.
In reaching their decision they will not only have to consider the relative cost of the two choices, but also the possibility of limits being put on what they are allowed to do by the European Commission.
And also the possibility that the eventual cost of keeping it going could run to well over the 5.7bn euro the bank is seeking.
The Minister for Finance Brian Lenihan said last week that any further capital injection to the bank would not exceed the 4bn euro put in by the government earlier this year.
The Department of Finance has so far declined to comment on the weekend report.
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