Irish Finance Minister Michael Noonan on Thursday evening outlined a bank restructuring plan, saying that the government will reduce the number of domestic banks to two "pillar banks."


HTML clipboard People walk past a bank on Grafton Street in Dublin March 31, 2011. Ireland will publish what is meant to be the final bill for propping up its banks on Thursday in a last-ditch bid to convince investors it can avoid deepening Europe's debt woes with a damaging restructuring. (Xinhua/Reuters Photo)
Speaking in the Dail, Ireland's lower house of parliament, Noonan said there will be two universal, full-service banks and a restructured Irish Life & Permanent (ILP).


He said the first pillar bank will be based on the Bank of Ireland, with the second one a combination of the Allied Irish Banks (AIB) and the Educational Building Society (EBS).


"Our banks in the future must be smaller, better funded and better capitalized," said Noonan.


He said the radical restructuring of the banking system is "designed to put the banking system on a firm footing and break the bonds with our toxic banking past," adding that it was "essential for the economy and our country."


The Irish minister said the plan will be submitted to the European Commission under state-aid rules.


He said the government was committed to the rescue program of the European Union (EU) and the International Monetary Fund (IMF), signed in November last year.


He said the previous government ducked and dived and procrastinated, that it did not fix the banks and that it paved the road to disaster.


Noonan also said bank depositors can be assured that their funds remain safe.


Ireland's Central Bank on Thursday published the results of vital stress tests on the four Irish banks, which show that they need to raise an extra 24 billion euros to cope with potential losses.


In a statement, the Central Bank said the 24 billion euros (around 34 billion U.S. dollars) is comprised of 13.3 billion euros for Allied Irish Banks (AIB), 5.2 billion euros for Bank of Ireland (BOI), 1.5 billion euros for Educational Building Society (EBS) and 4 billion euros for Irish Life and Permanent (ILP).


The Irish government has already injected 46.3 billion euros into its banking sector, and nationalized four financial institutions since the global financial crisis erupted in 2008.


VietNamNet/Xinhuanet