Six banks are now officially part of the State's deposit guarantee scheme.
AIB, Anglo Irish Bank, Bank of Ireland, EBS Building Society, Irish Life & Permanent and Irish Nationwide are the banks designated by Minister for Finance Brian Lenihan this evening to participate in the Credit Institutions (Financial Support) Scheme 2008.
Ulster Bank, First Active, Halifax Bank of Scotland, IIB Bank and Postbank have been invited by the Minister to participate in the Scheme and are eligible for the guarantee.
Under the terms of the scheme, if any covered institution defaults, the Minister for Finance 'will pay to the relevant creditor, on demand, an amount equal to the unpaid covered liabilities'.
The covered institutions will pay a quarterly charge to the Exchequer in return for the guarantee.
The scheme lasts until September 2010.
'The guarantee has as its central objective the removal of any uncertainty on the part of counterparties and customers and gives absolute comfort to depositors and investors that they have the full protection of the State,' the Minister said.
He said that the strict conditions accompanying the guarantee under the scheme 'will ensure that balance sheet growth is measured and in accordance with prudent banking practice, that risk is properly measured and managed and the interest of taxpayers are safeguarded'.
The Minister said he expects to make further orders shortly for the other banks eligible to avail of the scheme.
Financial Regulator asks for business plans
Meanwhile, it has been confirmed that the Financial Regulator has asked the six Irish banks who plan to be covered by the State's deposit guarantee to submit new business plans showing how they plan to reduce their risks.
It has also been confirmed that the regulator has placed 'officers' in each of the banks to scrutinise their future operations.
20 officers have been employed to be placed on site across the banks.
The moves were agreed as part of the €500 billion deposit guarantee introduced by the Government to prop up the Irish banking sector amid the global financial crisis.
