Feb. 22 (Bloomberg) -- Ireland’s government is “unlikely to need to plough even more money into banks,” even as the level of home loan arrears are a “great source of concern,” according to Eoin Fahy, chief economist at Kleinwort Benson Investors in Dublin.
Irish mortgages in arrears for more than 90 days rose stood at 9.2 percent at the end of last year, the country’s central bank said Feb. 17. “We should remember that the bank stress tests, last March, resulted in the banks being given very large amounts of capital from the taxpayer, precisely so that they could cope with losses on mortgages,” Fahy said in an e-mailed statement today. The country’s guaranteed banks “have enough capital to deal with losses amounting to 157 percent of the current level of arrears,” he said.
Separately, Fitch Ratings said “precise impact of debt forgiveness” in proposed new Irish personal insolvency laws remains “highly uncertain” for residential mortgage-backed securities.
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