€25bn of state money going into a ‘black hole’

UP to €25 billion in state funds being put into Anglo Irish Bank and Nationwide Building Society is going down “a black hole”, according to the Government’s former top banker.

Micheal Somers, who retired as the National Treasury Management Agency’s (NTMA) chief executive late last year, said “Anglo and Nationwide are really basket cases”, adding that “€20bn-€25bn of our cash is going to go down a black hole in those cases”.

However, Mr Somers said he did expect the €7 billion given by the state to recapitalise AIB and Bank of Ireland would, in time, be repaid.