Ratings agency Moody's today cut Anglo Irish Bank's unguaranteed senior debt by three notches and its subordinated debt by six. The decision comes ahead of moves by the Government to outline the total cost of bailing out the nationalised lender later this week.

Moody's downgraded the bank's unguaranteed senior debt to Baa3 - just one notch above junk status - from A3 and subordinated notes to Caa1 from Ba1.

The rating agency said that while it still expected the government to support senior debt, it would remain under review for possible downgrade until a decision was made.

'While Moody's considers the likelihood of the government not supporting this debt to be very small, this risk has been reflected in the three-notch downgrade,' Ross Abercromby, the lead analyst for Anglo Irish at Moody's, said in a statement.