IMF ‘reluctant’ to contribute to €90bn bank bailout

THE IMF is reluctant to contribute towards bailing out Irish banks and as a result the major part of the estimated €90 billion loan is expected to come from the European Commission and member states, according to EU sources.

The Washington-based organisation is carrying out stress tests, including liquidity tests that measure the banks’ ability to pay their debts as they fall due. They were not included in the tests during the summer.

It is expected the new tests will also reveal the size of the bad debts not just from big borrowers, much of which have already been hived off to NAMA, but from those in smaller businesses and defaulting mortgage holders, according to economic analyst Kevin Newman.