Updated at 13:30
THE HIGH COURT HAS GRANTED Minister Brian Lenihan’s application to provide further funding for AIB under the new Credit Institutions Stabilisation Bill. Details of the order approved by the court are expected to be released shortly.
The state is giving AIB a second bailout, this time of €3.7bn. If the bank agrees to the move, it could come under state control by the end of the day.
The money will come the National Pension Reserve Fund, The Irish Times reports, and will effectively nationalise the bank.
Lawyers for Lenihan applied to the court for a private hearing and asked for two Irish Times reporters to be refused entry, according to the paper. The minister claimed matters coming before the hearing were of “extreme commercial sensitivity”.
The financial transfer will make AIB the fourth financial institution to come under state control after Anglo Irish Bank, EBS and Irish Nationwide were nationalised, RTÉ reports.
Speaking to RTÉ News at One, Lenihan said AIB would be de-listed from the stock exchange due to the quantity of public ownership. He said that there was no reason that if a bank was well-run as a public utility company, it could generate profit and become valuable. He said taxpayers would get a return “on this investment” in time.
AIB sold off its Polish operations earlier this year in an effort to raise some money on its own to meet capitalisation levels required by the Financial Regulator. The bank had to raise €7.4bn before the end of the year. The state will have about a 90% stake in AIB once the sale of the Polish operation is completed in the New Year.
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