Ireland to Buy Banks' Dud Loans at 30 Pct Discount

By: Associated Press Email
By: Associated Press Email

DUBLIN (AP) - Irish Finance Minister Brian Lenihan says the government will acquire euro77 billion ($110 billion) in defaulting property loans from Ireland's struggling banks - and pay 30 percent

Lenihan revealed the price tag on Ireland's bail-bailout plans as the government opened debate Wednesday on a complex bill to create Ireland's "bad bank," the National Assets Management Agency.

Lenihan says the agency will pay five Irish banks euro54 billion in
government-backed bonds. In exchange, the agency will take ownership of euro77 billion in delinquent debts.

He says the assets backing the loans are worth just euro47 billion today, reflecting a 50 percent fall in property prices since 2007. The government expects prices to recover once Ireland's recession ends.

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