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| Version 7 | Version 8 |
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| Irish bank set to be nationalised | Irish bank set to be nationalised |
| (about 2 hours later) | |
| The Irish government has said it is to nationalise the Anglo Irish Bank after deciding pumping money into the lender was not enough to secure its future. | The Irish government has said it is to nationalise the Anglo Irish Bank after deciding pumping money into the lender was not enough to secure its future. |
| The state had planned on injecting 1.5bn euros (£1.4bn) into the bank, but said its weak funding and damage to its reputation prompted a change of tack. | The state had planned on injecting 1.5bn euros (£1.4bn) into the bank, but said its weak funding and damage to its reputation prompted a change of tack. |
| Anglo Irish has about 100bn euros on its books, but there was no need for customers to act, the state said. | Anglo Irish has about 100bn euros on its books, but there was no need for customers to act, the state said. |
| It added that all employees would stay with the firm. | It added that all employees would stay with the firm. |
| Shareholders will receive some compensation. | |
| The bank's board said it would work with the government to ensure its long-term commercial viability. | The bank's board said it would work with the government to ensure its long-term commercial viability. |
| 'Totally irrational' | 'Totally irrational' |
| The bank has been heavily exposed to the property and construction markets, both of which have seen a dramatic reversal in fortune in the past year. | |
| Its investments were heavily focussed in Ireland, whose economy - once considered among Europe's brightest - has shrunk after almost 15 years of boom. | |
| In the current circumstances the State is the only available potential owner Irish government | In the current circumstances the State is the only available potential owner Irish government |
| Anglo Irish was one of three institutions set to be part of a 5.5bn euro bail-out package, which Ireland's finance minister said was needed after "totally irrational lending to the property sector". | Anglo Irish was one of three institutions set to be part of a 5.5bn euro bail-out package, which Ireland's finance minister said was needed after "totally irrational lending to the property sector". |
| Ministers had been due to hand over the 1.5bn euros bail-out in return for 75% shares with an annual fixed dividend being paid to the government of 10%. | Ministers had been due to hand over the 1.5bn euros bail-out in return for 75% shares with an annual fixed dividend being paid to the government of 10%. |
| "In the current circumstances the State is the only available potential owner," the government said on Thursday evening. | |
| "I would again stress that this government decision safeguards the interest of the depositors of Anglo, and the stability of the economy, given the significance of Anglo in this regard, as already recognised by the European Commission," said finance minister Brian Lenihan. | "I would again stress that this government decision safeguards the interest of the depositors of Anglo, and the stability of the economy, given the significance of Anglo in this regard, as already recognised by the European Commission," said finance minister Brian Lenihan. |
| "The bank will continue to operate as normal and depositors and creditors should continue to transact as normal." | "The bank will continue to operate as normal and depositors and creditors should continue to transact as normal." |
| Reputational damage | Reputational damage |
| Anglo Irish recently lost top executives over a secret loans fiasco, which the government described as "unacceptable practices" which had played a part in the nationalisation. | Anglo Irish recently lost top executives over a secret loans fiasco, which the government described as "unacceptable practices" which had played a part in the nationalisation. |
| The bank's chairman, Sean Fitzpatrick, resigned in December after a 87m euros loan controversy where he admitted he had transferred millions of euros out of the Dublin-based bank's accounts. | The bank's chairman, Sean Fitzpatrick, resigned in December after a 87m euros loan controversy where he admitted he had transferred millions of euros out of the Dublin-based bank's accounts. |
| Chief executive David Drumm announced his resignation shortly afterwards. | Chief executive David Drumm announced his resignation shortly afterwards. |
| These events caused "serious reputational damage to the bank at a time when overall market sentiment towards it was negative," the Irish government added. | These events caused "serious reputational damage to the bank at a time when overall market sentiment towards it was negative," the Irish government added. |
| Guarantees | Guarantees |
| A lack of liquidity has made it increasingly difficult for the banks to lend money to their customers. | A lack of liquidity has made it increasingly difficult for the banks to lend money to their customers. |
| And confidence in Irish banks has been undermined by the global credit crunch. | And confidence in Irish banks has been undermined by the global credit crunch. |
| They have been especially badly hit by a slump in the Irish property market which has led to a collapse in the value of investments linked to the property market. | They have been especially badly hit by a slump in the Irish property market which has led to a collapse in the value of investments linked to the property market. |
| In October the Irish government acted to shore up its financial system by guaranteeing all deposits in Irish banks and all money borrowed by the banks from other financial institutions. | In October the Irish government acted to shore up its financial system by guaranteeing all deposits in Irish banks and all money borrowed by the banks from other financial institutions. |
| This led to many savers in the UK putting money there as it came before the UK government had boosted its protection for savings. | This led to many savers in the UK putting money there as it came before the UK government had boosted its protection for savings. |