Sept. 8 (Bloomberg) -- Anglo Irish Bank Corp. expects “certainty” from the government on the future of the lender today, which may help stem an outflow of deposits.
The bank has seen “material” outflows in recent days because of the uncertainty around its future, Chief Financial Officer Maarten van Eden said in an interview in Dublin today. It expects this to “stabilize when certainty is restored,” Chief Executive Officer Mike Aynsley said in the same interview.
Ireland’s Cabinet is discussing options today for Anglo Irish, which the government nationalized last year. The bank is selling loans to a state agency and executives propose splitting the remainder of the loan book into a so-called good bank which would keep lending and a bad bank managing the wind-down of the rest of the loans.
Van Eden also said that it would be a “disaster” if Anglo Irish was to default on its bonds.
The premium investors charge to hold Irish 10-year debt over the German equivalent, Europe’s benchmark, has risen to a record in the past month after Standard & Poor’s cut the country’s credit rating to AA-, saying the state may have to inject as much as 35 billion euros ($44.5 billion) into Anglo Irish “over time.”
Finance Minister Brian Lenihan said this week the bailout is “manageable” and won’t bankrupt the country.
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