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Moody's slashes Anglo debt rating

Credit agency Moody's has downgraded Anglo Irish Bank's senior debt.

It slashed its rating for the bank's unguaranteed senior debt to just above junk status.

The downgrade comes ahead of an announcement by the Irish government which is expected to set out the cost of the taxpayer-funded bank bailout, which currently stands at €22bn, with the final figure edging closer to €35bn.

Moody's said it expected the Irish government to support the senior debt, but the rating would remain under review until a decision was reached.

Ross Abercromby, lead analyst for Anglo Irish at Moody's, said: "Moody's expects a continued asset quality deterioration in the loan book of Anglo Irish that will require further government support for the bank's liabilities.

"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."

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