The Central Bank and Financial Regulator has said Irish Life & Permanent must raise €145m in funding by May 31 next year.
The regulator today published its assessment of how much capital the institution would need to cope with potential future losses. The regulator's target is designed to ensure IL&P could cope if economic conditions worsened.
The other five banks covered by the Government guarantee scheme underwent this process earlier this year as they were due to transfer loans to the National Asset Management Agency.
IL&P must now submit its plans to secure the new funding within 30 days. The regulator also said IL&P had passed the stress test applied to other European banks in July by the Committee of European Banking Supervisors earlier this year.
IL&P welcomes regulator's verdict
IL&P chief executive Kevin Murphy welcomed the regulator's statement, saying it confirmed the group's 'robust capital strength'. IL&P has not required any help from the Government.
Mr Murphy said IL&P would meet the funding target through a securitisation, which was already underway, as well as cashflow from its non-baking subsidiaries. In a securitisation, the bank receives cash from investors, who are repaid from future profits from certain assets.
IL&P also confirmed, however, that if its banking arm Permanent TSB were separated from Irish Life as part of its offer to buy EBS, €925m would be needed for Permanent TSB. It said this would be funded through internal resources, a debt buy-back programme and a capital
