Europe needs to contain Ireland’s financial crisis before it spreads across the region, British Bankers’ Association Chief Executive Officer Angela Knight said.
It’s key that “Ireland do contain their problems and we don’t start to see them rolling too fast across Europe,” Knight said in an interview with Maryam Nemazee on Bloomberg Television’s On The Move. “We look to Ireland to take both the assistance that is financially offered to it but also the assistance in the way of advice offered by the” International Monetary Fund, she said.
Ireland, which on Nov. 21 became the second euro member to seek a bailout from the European Union and IMF, may get about 85 billion euros ($113 billion), according to two officials familiar with the talks on the loan’s size. Ireland was forced to seek a rescue after the country’s real-estate boom turned to bust, crippling the country’s banking system.
British banks’ exposure to Ireland is “reasonably contained” and they have already mitigated much of their exposure to the country, said Knight, the top lobbyist for the country’s lenders.
U.K. banks have the biggest exposure to Ireland, totaling more than $222 billion at the end of the first quarter, according to data compiled by the Bank for International Settlements.