Accountants KPMG inserted “an emphasis of matter” clause in its auditor’s report.
Such a clause is included where there is “significant uncertainty” around certain issues that merit a particular mention in the report.
The inclusion of this type of clause is unusual in the accounts of a financial institution.
KPMG said the annual report set out “a number of material economic, political and market risks and uncertainties that impact the Irish banking system”.
The auditors said that this “may cast doubt upon the group’s ability to continue as a going concern”.
These included the group’s “continuing ability” to access funding from the European and Irish central banks to meet liquidity requirements and its ability to raise additional capital to meet the required regulatory capital ratios.
“These matters, together with the options available to the group, have been considered by the directors in concluding that it is appropriate to prepare the financial statements on a going concern basis,” said the accountancy firm.
I have all my savings in PTSB as I thought that they were the safest Irish Bank ???
What would happen mortgages with PTSB if they were to shut down or merge? Would people lose their trackers and be forced on to variable mortgages?
? I am taking my money out of Permo on Monday and moving it to KBC.
Why is there a need for you to do this when there is a government guarantee?
[broken link removed]THE GOVERNMENT may be forced to take a large stake in Irish Life & Permanent (IL&P), the only lender to have so far avoided taking State capital, as a result of the severity of this week’s bank stress tests.
The move would give the Government part or majority ownership of a sixth and last privately owned Irish bank, and may lead to the effective nationalisation of the domestic banking sector.
The intense scrutiny of residential and buy-to-let mortgages in the latest round of Central Bank stress tests is likely to force IL&P, the biggest mortgage lender during the property boom, to cede significant ownership to the State.
IL&P’s profitable investment and pensions business and the decision of Permanent TSB to avoid lending to developers meant it has not had to resort to Government cash since the banking crisis began in 2008.
However, IL&P borrowed more heavily than any other Irish lender to fuel mortgage lending.
As a result, IL&P faces the greatest challenge under the Central Bank’s new liquidity stress test this week, to bring its €38 billion loan book closer in line with deposits of about €19 billion.
Expected losses arising from the capital stress test and from the planned disposal of excess loans under the liquidity stress test are expected to make some form of Government ownership inevitable.
IL&P’s market value of €205 million makes the company’s ability to raise cash to cover the losses almost impossible, forcing it to seek Government capital. “It’s a question of whether the Government will take over or under 50 per cent [majority control],” said a source familiar with the company’s situation.
A spokesman for the company had no comment, while a spokeswoman for the Central Bank would not comment ahead of the stress test results on Thursday. IL&P is scheduled to hold a meeting of its board today.
The State is now likely to take majority ownership and full control of Irish Life & Permanent following the stress tests of banks.
It is understood that the amount of capital required for the group's bank PermanentTSB is likely to be in the region of €600m to €1bn.
This afternoon, shares in Irish Life and Permanent are down 46%.
Earlier today, the company was valued at €200m so the scale of capital injection which would be required by the State is likely to force the organisation into State control.
I've already given notice for my 35 day notice account with PTSB as the interest rate reduced to 2.5% last year. Should I move these to a safer financial institution?
Today I asked my employer to credit my salary on the rabo account, not anymore on PTSB...
Will they let you do this? Normally salaries have to paid into a current account.
No requirement that the account be a current a/c Ciaran,my wife works for a semi state and her salary is paid into an UB Dual a/c.
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