Government told in 2008 rescuing banks would cost €16.4bn

Merrill Lynch & told the Government in 2008 it would cost €16.4bn at most to rescue Irish banks, a quarter of the eventual bill for bailing out its financial system.

Merrill produced the estimate in a 45-page presentation to the Department of Finance on November 18, 2008, according to documents released after a Freedom of Information request by Sinn Féin’s Pearse Doherty. The firm was paid €7.3m for banking advice in 2008 and 2009.

Since the estimate, taxpayers have been forced to pledge about €64bn to rescue the banks. In November 2010, Ireland applied for the EU/IMF bailout.