Multi-billion euro writedowns facing six main banks to be disclosed by July

THE size of the multi-billion euro writedowns facing the six Irish banks on their property loans will be disclosed by the Government when legislation to set up the bad bank is announced in July, Finance Minister Brian Lenihan said.

He has also indicated that the Dáil might have to be recalled from its summer recess to enact the legislation to allow the Government to press ahead with the “bad bank” concept.

Ultimately the size of the discount it will demand for taking up to €90bn of toxic loans off the balance sheet of the six Irish banks under state guarantee will determine whether Bank of Ireland and Allied Irish Banks require more capital from the Government.