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Central Bank deputy says Irish banks may need more money

Matthew Elderfield has said in an interview that the banks are likely to need a further €3-4 billion in order to meet stiff capital requirements.

Image: HELMUT FOHRINGER/APA/Press Association Images

THE DEPUTY GOVERNOR of the Irish Central Bank Matthew Elderfield has said that banks here could need to raise a further €3 or €4 billion in the next five or six years.

Germany’s Boersen-Zeitung reports that Elderfield said in an interview that the banking institutions here are still “very much” dependent on liquidity support from the eurozone.

According to Bloomberg, he also said that because of international capital requirements the banks may need to raise up to €4 billion. Ireland’s institutions are highly dependent on aid from Europe.

Elderfield said that Ireland also needs a “more stable base” in the long term, in order to show investors that progress has been made in dealing with the banks, and in order to show the potential for growth in Ireland.

Earlier this month the Central Bank governor Patrick Honohon called for an EU-wide “banking union” in order to deal with the ongoing debt crisis. Honohon also said that money should be injected directly into the banks from the European Financial Stability fund, rather than lending to the government.

Last night the Financial Times warned Spain against following Ireland down the path of saving the banks at the expense of the State.

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Emer McLysaght

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