Irish government begins bank bailout

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Steve Chiotakis: There’s a bank bailout underway in Ireland. The government there is pumping more than $7 billion into the biggest banks. From the European Desk in London, here’s Marketplace’s Stephen Beard.

Stephen Beard: The Irish Government is offering to inject the money into the three top banks in return for shares. There are strings attached. Among other things, the banks will be required to increase mortgage lending by 30 percent.

But Irish property prices are falling sharply. Unemployment is rocketing. It’s not clear how much demand there will be for the new mortgages.

The government says the move will boost investor confidence. That confidence has been badly shaken, and not only by the property crash. There’s been a scandal, too. The chairman of one of the banks has just been forced out. He admitted receiving secret personal loans worth $120 million.

In London, this is Stephen Beard for Marketplace.