Economists claim move is confusing and lacks clarity

THE decision to split Anglo Irish Bank into a funding bank and an asset recovery bank received a mixed response from economists who described it as “confusing” and lacking in clarity.

Finance Minister Brian Lenihan said the option to split the bank had been chosen because the alternative of closing the bank immediately exposed the State to a debt of €72 billion. Under the plan, Anglo will be split into a so-called good bank, which will retain the lender’s deposits, and an asset recovery bank which will run down its loans over time.

However, analysts expressed disappointment at the lack of detail and clarity in the plan.