Irish Banks Undergo Government Review
Ireland has completed a review of three of the country’s largest banks, pointing out potential capital shortfalls, Reuters reports. Ireland is one of the few true success stories on a European continent plagued by economic woes and regulatory nightmares. The country has recently announced that it will be exiting its bailout program provided by international creditors to help the nation keep its banks afloat. With December 15 set as the date for the exit to be completed, the country underwent a review of the balance sheets of its three primary lenders.
The findings were, on the surface, positive. None of the institutions will be forced to raise capital on an immediate basis. However, the full results are yet to be made public, and detailed reports about the findings are unavailable. Only one bank, the Bank of Ireland, has published a report on the recommendations of the central bank, which were to raise hundreds of millions of euros of additional funds to cover potential problem areas in its loans and assets. The Bank of Ireland disagrees with the central bank’s report, and it has stated that talks between the two institutions are currently underway to sort out specific discrepancies in the analyses.
According to the report, the Bank of Ireland will need an additional 360 million euros to cover mortgage loans, 486 million euros in provisions for commercial loans, and 547 million euros to cover losses that are expected to occur that the bank has not currently anticipated. The Bank of Ireland is contesting many of those numbers, saying that they reflect industry-wide templates that are not applicable to many of the bank’s specific assets.