Banks are ‘unlikely to require further capital'

The banks are unlikely to need further capital following the asset quality review and the stress tests of the sector next year, according to the Irish Fiscal Advisory Council.

The budget deficit spiralled to 32% of GDP in 2011, as the Government had to include the costs of bailing out the banking system.

Now as part of EU banking union, the three Irish banks, Bank of Ireland, AIB and Permanent TSB, have to undergo a comprehensive review of their assets over the next year to determine whether they are sufficiently well capitalised to withstand future losses.