Press Release: State aid: Commission temporarily approves rescue aid for Bank of Ireland

The European Commission has granted temporary approval, under EU state aid rules, to the recapitalisation of Bank of Ireland (BoI) by the Irish authorities of up to €5.35 billion.

This follows from the calculations of the Irish central bank, in March this year, of the capital needed to deleverage and meet higher than normal loan-to-deposit ratios to be able to resist stress situations.

The prudential capital assessment review carried out by the Central bank was required under the Programme for Support for Ireland agreed in November 2010 between the Irish authorities, on the one hand, and the EU, ECB and IMF, on the other hand. The Irish State will underwrite the issue of new rights by BoI for up to €4.35 billion. Another €1 billion will be provided as contingent capital.

• Primary Source

ESO: Background Information: Press Release: State aid: Commission approves resolution of Anglo Irish Bank and Irish Nationwide Building Society http://www.europeansources.info/record/press-release-state-aid-commission-approves-resolution-of-anglo-irish-bank-and-irish-nationwide-building-society/

ESO: Background Information: EU warns Ireland over banking plan http://www.europeansources.info/record/eu-warns-ireland-over-banking-plan/

Irish Times, 12.7.11: Commission gives B of I temporary approval for €5.35bn recapitalisation http://www.irishtimes.com/newspaper/finance/2011/0712/1224300558256.html

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