Thursday 17 August 2017

Irish debt nightmare for UK banks

Peter Flanagan

Peter Flanagan

Banks based in the UK have by far the largest exposure to Irish debt, according to new figures released yesterday.

Statistics from the Bank of International Settlements (BIS) show Ireland has total outstanding debt of nearly $626bn (€510bn).

UK-based banks hold nearly $232bn of this, while US banks -- which have the second highest exposure -- hold $95bn. The figures have added to concerns in the UK about the exposure of the country's banks -- the report also shows that British banks hold around $150bn of Spanish debt.

The details were published in the latest BIS Quarterly Review, which also describes the recent €750bn European rescue package as having "bought a temporary reprieve from contagion in euro sovereign debt markets, but market concerns about the economic outlook remain".

Overall, Irish banks have outstanding claims of $871bn, nearly half of which is against Germany and Britain. This figure, however, includes debt owed to non-Irish banks that are headquartered in the IFSC and don't affect the exchequer.

Last month, BIS figures showed that Irish banks were exposed to over €6bn worth of Greek debt. However, the Government said that excluding IFSC banks the real exposure to Irish domestic banks was more like €40m.

Irish Independent

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