Loan for toxic bank to hike national debt

THE EU could force the Government to include borrowings to fund the toxic bank it is setting up as part of the national debt.

That would add significantly to our debt/GDP ratio going forward and would put increased pressure on the national finances.

It is contrary to the hope expressed by Finance Minister Brian Lenihan when he announced the formation of the National Asset Management Agency on Wednesday, that the debt raised would not have to be added to the general government debt because of its intended use.