Anglo Irish Bank To Be Nationalised
Updated: 11:26pm UK, Thursday 15 January 2009
The Irish Government is to nationalise the troubled Anglo Irish bank.
The state had moved to plough 1.5 billion euro (£1.4bn) into the bank, which has lost four top executives over a secret loans fiasco.
But the Department of Finance said recapitalisation was not the way to secure its future.
It said its funding position had been weakened and unacceptable practices - including the 87 million euro (£79m) loans controversy - had caused serious damage to its reputation.
"The funding position of the bank has weakened and unacceptable practices that took place within it have caused serious reputational damage to the bank at a time when overall market sentiment towards it was negative," a statement said.
"Accordingly, the Government believes that the recapitalisation is not now the appropriate and effective means to secure its continued viability.
"Therefore the Government must move to the final and decisive step of public ownership."
Anglo Irish said its board met this evening after the Government's decision not to proceed with the recapitalisation of the bank.
It said the Government advised that it would be taken into public ownership.
In a statement, Anglo Irish said the board would work fully with the Government to ensure the long-term commercial viability of the bank.
"Anglo Irish Bank will continue to trade normally as a going concern and accordingly customers and providers of funding can be fully assured of the safety of their deposits and investments, which remain State-guaranteed," the statement said.
"The board and management are committed to driving the business forward on an independent and commercial basis."
Anglo Irish was due to hold an EGM of shareholders in Dublin's Mansion House to approve the Government's 1.5 billion euro (£1.3bn) recapitalisation plan to rescue the institution.
However, the bank said the purpose of the EGM no longer existed, and the meeting would be opened and adjourned.
