Ireland, E.U., IMF, Bailout Dusts Banks (IRE, AIB, RBS, LYG, IRL)

Ireland’s finance ministers have said that the banks will need more capital, and they also said that a further shrinking of the operations and balance sheets will be needed.  At issue for the banks is that the new capital requirements are not yet set.  These new rules will be mandated after further stress tests are made.  This is beginning to feel like TARP 16 or Financial Groundhog Day.

Two non-Irish banks also find themselves in the mix here.  Royal Bank of Scotland Group PLC (NYSE: RBS) has close to $100 billion equivalent of Ireland exposure and Lloyds Banking Group PLC (NYSE: LYG) has closer to $50 billion equivalent in  loan exposure in Ireland.

Allied Irish Banks plc (NYSE: AIB) is down 11% at $1.09 and The Bank of Ireland (NYSE: IRE) is down 17.5% at $2.20.  Royal Bank of Scotland Group plc (NYSE: RBS) is down 4.5% at $12.79 and Lloyds Banking Group plc (NYSE: LYG) is down 4.7% at $4.07.

We are still waiting for trading in The New Ireland Fund, Inc. (NYSE: IRL).

JON C. OGG