AIB could be sold to EU rescue fund

Allied Irish Bank could be sold to the EU’s rescue fund under an agreement reached by eurozone finance ministers as part of a new scheme for winding up or rescuing banks.

They agreed to set aside €60bn from the €500bn European Stability Mechanism’s fund to recapitalise banks, in a plan to ensure taxpayers will not be left to pick up the tab in future.

The ministers, meeting in Luxembourg, also decided on a hierarchy of who should lose money first when an institution gets into trouble, and agreed not to touch the savings of those with €100,000 or less.