Ireland has responded to the effects of the global financial crisis on Irish credit institutions principally by:
- introducing a legislative framework within which the Minister for Finance may – until 29 September 2010 in most cases – provide financial support (including guarantees) to any credit institution that the Minister designates for these purposes, and recently announcing that a State guarantee would be put in place for the future issuance of debt securities with a maturity of up to five years;
- in that legislative framework, setting new rules and procedures for any acquisition of or merger involving an Irish-licensed credit institution;
- based on that new legislation, implementing – until 29 September 2010 – a State guarantee scheme in respect of all retail, corporate and inter-bank deposits with and senior unsecured debt, asset covered securities and dated subordinated debt (Lower Tier 2) (excluding intra-group borrowing) of each of seven credit institutions and certain subsidiaries of some of those institutions, and in April 2009 announcing that a five-year guarantee would be introduced for certain debt securities;
- providing €3.5 billion core tier 1 capital to Bank of Ireland and nearing completion of a similar investment in Allied Irish Banks;
- taking Anglo Irish Bank Corporation into public ownership;
- announcing that a statutory National Asset Management Agency will be established and operational by Summer 2009 to acquire from systemically-important institutions (including at least the institutions covered by the current State guarantee) most of their property-related loans (whether secured on land in Ireland or abroad); and
- announcing that the structure of financial regulation in Ireland will be reformed.
A detailed briefing on these important developments is available here.
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