The Finance Minister says the government will seek to impose losses on senior bondholders at Anglo Irish Bank and Irish Nationwide.
Speaking in Washington Michael Noonan said he has the support of the International Monetary Fund (IMF) for the plan and will now seek the backing of our EU partners.
Up until now bondholders in Irish banks have been protected from losses which have been footed largely by the Irish taxpayer.
But Michael Noonan said in Washington today that the IMF has given its backing to a proposal by the government to burn the senior bondholders at Anglo Irish Bank.
There is €3.5 billion worth of unsecured debt at Anglo and Irish Nationwide which the Minister said are no longer normal banks but are more like warehouses for bad debt.
Michael Noonan said he would be seeking the support of Ireland’s European partners to impose losses on those bondholders.
He has also said that he has asked the US Treasury secretary Timothy Geitner to support Irish efforts to seek a cheaper bailout deal from the EU and the IMF.
Mr. Geitner has promised to speak to the French government on behalf of Ireland.
