The Irish stock market |enjoyed the biggest gains of any global stock market after Finance Minister Brian Lenihan revealed details of the make-up of the NAMA |bail out for banks.
The move was unsurprisingly led by banking stocks, some of which gained more than a third following the news.
Bank of Ireland (BoI) and Allied Irish were set well from the start of trading. Bank of Ireland rallied 18% to €3.38 and Allied Irish jumped 28% to €3.41, the steepest increase since January.
Allied Irish said it will seek to raise about €2bn in capital from investors and asset sales after taking losses on loans it's selling to NAMA. BoI said it can raise capital internally or “through access to capital markets”.
The government in Dublin had confirmed that the country’s “bad bank” would pay out €54bn (£48bn) to high street banks as part of its rescue bid.
The hugely contentious proposals for the National Asset Management Agency were |designed to take impaired on bad loans out of five Irish banks so they could start lending as normal again and kick start an economic recover in the Republic. The other banks to be bailed out are EBS building society, Irish Nationwide and the now nationalised Anglo Irish Bank.
Overall the ISEQ soared 3.12% or 105 points to 3469.49, surpassing gains on most of the world’s major stock markets. Construction giant CRH had started the day strongly after French construction group Saint-Gobain had its rating lifted, but came in for some profit taking later and finished with a gain of just 0.71% at €19.75.