Shares in Bank of Ireland and Permanent TSB slumped badly from early morning to finish down 20.81% and 19.84%.
Hundreds of millions of euro was wiped off the value of the two banks with Irish taxpayers shareholding in the financial institutions falling by €260m or so.
The fallout from the UK’s decision represented the latest blow to the state’s shareholding in what has been an arduous year for Irish bank shares.
Overall, the Iseq fell 7.72% yesterday after recovering from a heavy early slump which saw it down 12.73% at one stage early yesterday.
Investec Ireland chief economist Philip O’Sullivan said the share price hammering was no surprise given trading across Europe throughout the day and while Irish stocks shipped heavy losses, the Iseq still fared better than some of its fellow European counterparts.
“There have been huge falls recorded in many continental European exchanges.
“So the Iseq is not a particularly well-diversified index, we’re not one of the bigger economies so we don’t have huge numbers of shares but the overall quantum of the move wasn’t as severe compared to other markets.
“Within that though, there were some notable moves, unsurprisingly. Of the 46 companies on the Iseq only two of them at present were up today.
“The fall in bank shares was absolutely a big hit for Irish taxpayers.
“It’s the latest hit to valuations in the sector. Obviously, you had the other issues in terms of political interference that we saw earlier on this year but I guess from Bank Of Ireland’s perspective, 50% of its balance sheet is UK assets.
“RBS was off as much as 34% earlier today which was absolutely incredible for a company of that size to experience such a reaction,” Mr O’Sullivan said.
Other significant losers yesterday were Kingspan Group whose shares plummeted 26.28%, Merrion Pharmaceuticals (-20%) and Dalata (-14.40%).
Paddy Power, which was one of the bookmakers that forecast a clear win for the ‘Remain’ campaign on Thursday evening, saw its shares slump 4.57%.
The Irish Stock Exchange yesterday said that it would do “all that it can to ensure that any potential risks to the position of the Irish capital market are managed”.
“We will work with the Irish government and other stakeholders to ensure that our competitiveness and our position as a gateway to Europe is protected and enhanced,” it said in a statement.