Bank moves closer to bailout target

Ireland’s banks have pledged to shrink their loan books, bloated after a disastrous binge on property, by nearly a third between 2011 and 2013 to cut their dependence on emergency European Central Bank funding after being largely shut-out of wholesale debt markets.

Bank of Ireland’s sale of Burdale, which sells loans secured against assets, means it has raised 8.6 billion euros in divestments this year at an average discount of seven per cent, within a base case discount assumed in stress tests carried out under the European Union-IMF bailout. The bank, the only domestic Irish lender to avoid falling into state control, said it expected to complete its remaining divestments within the overall base case discount assumed under the stress tests.