AIB has revealed the state of its loan book and it’s bad. The previously optimistic AIB issued a management statement in advance of tomorrow’s EGM warning that its bad debt losses would reach €4.3 billion, a figure in excess of its own worst case scenario predictions made just two months ago.
And there’s another twist. Who’ll pay for these bad loans? The Irish taxpayer, of course. After tomorrow’s EGM when shareholders vote on a €3.5 billion State recapitalisation package we will all be on the hook.
And it’s only going to get worse as the economic climate in Ireland worsens and more borrowers default. AIB’s “criticised” loans have already risen by €9 billion to €24.3 billion in the first three months of the year.
For analysis by Dr Constantin Gurdgiev of what AIB’s Interim Management Statement really means click here
