Page last updated at 18:32 GMT, Monday, 29 March 2010 19:32 UK

Irish bank stocks fall before government announcement

AIG logo
AIB recently reported a large annual loss

Shares in two Irish banks have fallen sharply, a day before the Republic of Ireland government is expected to say it will raise its stakes in the banks.

Stocks in Allied Irish Banks (AIB) ended Monday trading down 20% at 1.365 euros, while those of Bank of Ireland fell 10.4%.

Reports say the government will lift its stake in AIB from the current indirectly-owned 25% to more than 70%.

It is expected to raise its ownership of Bank of Ireland from 16% to 40%.

Both banks have been continuing to struggle with losses and bad debts on the back of the big downturn in the Irish property market.

At the start of this month, AIB reported a pre-tax loss of 2.6bn euros ($3.5bn; £2.4bn) for 2009. describing the year as "very challenging".

Irish Finance Minister Brian Lenihan is due to speak about the government's plans regarding the two banks on Tuesday.



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