Emmet Oliver: Uncertainty remains State's biggest hurdle
Published 30/09/2010 | 05:00
THE Government is expected to produce mountains of fresh information today on the recapitalisation of Anglo Irish and other banks, but one core conclusion will be obvious -- the estimated cost of rescuing the banks is set to increase yet again.
Whereas only a few weeks ago all the talk was of Anglo's total capital requirement coming to €25bn, today a far larger requirement will be unveiled by Finance Minister Brian Lenihan. The new "central case" scenario is expected to be €29bn, with a worst case scenario coming to a horrifying €34bn, just €1bn below an earlier forecast -- widely dismissed -- by Standard & Poor's.
The taxpayer is the only available provider of the capital and consequently the news that the requirement has grown is likely to cause huge dismay. But what will the markets say?