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Ireland details massive bank cleanup

Ireland details massive bank cleanup
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The Irish government has admitted it could cost up to 50 billion euros to bailout the banks at the centre of the country’s financial crisis. One lender – Anglo Irish – may need 34 billion euros.

To raise that money there will have to be yet more drastic cuts in public spending.

Ireland’s Finance Minister Brian Lenihan called the cost “horrendous” but said it will “bring closure.”

He told reporters: “We have a clear structural resolution of the Irish banking crisis: two institutions will be downsized over time as we have discussed already; the two major banks are now well-capitalised, purged of their toxic assets and in a position to move forward on a platform of growth.”

The financial markets were happy that at least the final clean-up cost is now known.

Recession-hit Dubliners facing further austerity measures were not so happy.

One man said: “Well I supposed something has to be done, but it’s hard to come to terms with those kind of figures.”

Another was more critical of the government saying: “I believe they never should have bailed them out in the first place.”

The banks’ bad loans come from the bursting of Ireland’s property bubble.

The finance minister said the lenders were too big to fail and their collapse would bring down Ireland’s economy.