Shares in the State’s two main banks continued their strong performance this afternoon with AIB gaining almost 30 per cent and Bank of Ireland stock up 22.5 per cent by mid-afternoon.
At 3.15pm Bank of Ireland shares were trading at 38 cent and AIB's were at 80 cent, with the overall Iseq Index up just under 1 per cent.
Volumes were strong for a third day running, with 12.5 million AIB shares and over 7 million Bank of Ireland shares traded in Dublin.
Dublin brokers said despite numerous rumours in the market suggesting who was behind the share trades there was no evidence of one person or organisation stake-building.
Today's
Irish Timesreported the Government is preparing to bring forward the recapitalisation of AIB and Bank of Ireland to convince the markets neither will be nationalised.
Under the Government’s recapitalisation plan, it is providing €2 billion to each bank in the form of preference shares.
The banks must seek an additional €1 billion each from private investors with the State willing to provide the funds should they be unsuccessful.
Notwithstanding the gains in recent days, the collapse in their share price means there is little prospect of the banks raising the money from private investors.
According to this morning’s report, there is also the possibility that the weakest loans on the books of both banks will be transferred into the newly nationalised Anglo Irish Bank.
