The new National Asset Management Agency is to target all of the land and property development loans of the six banks of covered by the State guarantee.
The agency will also purchase healthy borrowings as well as bad debts in some cases.
This means the total potential book value of the loans which will be purchased will be between €80 billion and €90 billion.
However, the amount paid will be far less than this figure.
Finance Minister Brian Lenihan said: 'This is about ensuring people can access credit.'
He said it was also about giving assurances to depositors in Irish banks. The new agency will have a commerical mandate.
'It is the intention to secure all of the loans. Some performing some not performing but it is important they are all taken in,' added Minister Lenihan.
