Bloomberg News

Ulster Bank Lost $1.1 Billion Deposits Amid 2008 Irish Guarantee

December 12, 2011

Dec. 12 (Bloomberg) -- Royal Bank of Scotland Group Plc’s Ulster Bank unit lost the equivalent of 732 million pounds ($1.14 billion) of deposits in the four days after Ireland’s government guaranteed the country’s banks in September 2008, according to a Financial Services Authority report.

“The Irish government’s announcement that it would guarantee the deposits of Irish banks but not banks such as RBS’s subsidiary Ulster Bank further intensified pressure on RBS’s liquidity position in the period that followed the failure of Lehman Brothers,” according to the FSA report, published today.

Ulster Bank’s assets grew at an average 26 percent rate in the four years through 2007, to 55 billion pounds, it said. Ulster’s cumulative impairment charge for the three years through 2010 equate to 7.5 percent of its gross loans at the end of 2008, the report said. It was more than double the average 3.1 percent charge for RBS’s total loans over the period.

To contact the reporter on this story: Joe Brennan in Dublin at jbrennan29@bloomberg.net

To contact the editor responsible for this story: Dara Doyle at ddoyle1@bloomberg.net


The Good Business Issue
LIMITED-TIME OFFER SUBSCRIBE NOW
 
blog comments powered by Disqus