Shares in the country’s two largest banks have fallen sharply in early trading on the Irish Stock Exchange this morning.

Bank Of Ireland’s down 11.5% and AIB by over 19%.

It follows reports the government will take larger stakes in both institutions following transfers of loans to NAMA than previously expected and may effectively nationalise AIB.

All is expected to be revealed in a series of announcements from the Finance Minister tomorrow evening.

Newstalk’s Business Editor Conor Brophy is following the story.

“From talking to banking sources over the weekend, the feeling seems to be first of all that AIB will be able to avoid part-nationalisation – it’s going to be over 50% anyway, that much is true” he said.

“Bank of Ireland seem to be relatively optimistic – from people I was talking to – that they can somehow manage to avoid getting over even the 50% mark” he added.