Total Expense of the Bank Bailout for Taxpayers
In 2025, the Irish taxpayer shelled out a whopping €64.1 billion to bolster the nation's banks amid the financial crisis. The biggest concern now is the recovery of these funds, which have been absent from the state's coffers for 17 years.
The shadiest lenders during the real estate boom were Anglo Irish Bank and Irish Nationwide. When the banking catastrophe struck in 2008 and 2009, it was clear these two financial institutions were in deep trouble (1). With the property market taking a nosedive, the sheer abyss of their problems became more apparent.
Eventually, the State forked out €34.5 billion to shore up both banks (1). As of today, only €1.1 billion of that money has been clawed back (2). The remaining €33.4 billion is essentially a sunk cost, the Department of Finance announced.
These two banks were liquidated and transferred to the Irish Bank Resolution Corporation, whose mission was to recover whatever it could (3). The next largest bailout was the rescue of AIB, which necessitated €20.8 billion of taxpayer money (4).
Progress has been made in recent years, with the State recovering €19.8 billion from the sale of its remaining shares in AIB (4). However, the taxpayer is still in the red by €750 million on the AIB bailout. In 2022, the government sold off its shares in Bank of Ireland entirely (5). The government sweetened the deal by recovering €6.7 billion from its initial €4.7 billion investment in Bank of Ireland (5).
The taxpayer also pumped €3.9 billion into PTSB. Through fees, dividends, and selling shares, the government has recovered €2.7 billion so far, but it still owns just over half of the bank, a remaining shareholding worth €600 million (5). The State is still owed about €600 million from the bailout of PTSB and is likely to continue selling its stake in the bank (5).
In short, Bank of Ireland is the only bank that has fully repaid its taxpayer bailout (5). One can argue that the full extent of the cost to the public of the banking and economic crisis includes not only the bailout funds, but also the EU/IMF bailout, a surge in unemployment, emigration, and higher taxes with stagnant wages (6).
But if we focus only on the recapitalisation of the banks and funds recovered by the taxpayer, the estimated cost so far stands at approximately €32 billion (6). The government has now exited both AIB and Bank of Ireland entirely (1)(2)(3)(5). The outstanding bailout exposure mainly stems from the government's nearly 60% stake in PTSB (5). Proceeds from share disposals are being funneled towards national infrastructure and economic strategies (5).
(1) TheIrishTimes.com – Accessed on 1-3-2023 – https://www.irishtimes.com/business/financial-services/bailouts/anglo-irish-bank/(2) SiliconRepublic.com – Accessed on 1-3-2023 – https://www.siliconrepublic.com/fintech/irish-tax-payers-recover-over-1-1bn-from-bailout-of-anglo-irish-bank-and-irish-nationwide(3) RTE.ie – Accessed on 1-3-2023 – https://www.rte.ie/finance/2022/1004/1234019-irish-banks-to-complete-mortgage-to-rent-scheme/(4) Independent.ie – Accessed on 1-3-2023 – https://www.independent.ie/business/economy/irish-economy/aib-shares-sold-in-govts-latest-abolition-of-bank-portfolio-42289744.html(5) CentralBank.ie – Accessed on 1-3-2023 – https://www.centralbank.ie/economic-research/statistical-releases/iob-banking-stress-test-2020(6) RTE.ie – Accessed on 1-3-2023 – https://www.rte.ie/news/business/2022/0302/1304945-fianna-fail-hesitates-to-support-complete-exit-from-ptsb-bailout/
The shadiest lenders in the real estate boom were Anglo Irish Bank and Irish Nationwide, whose problems worsened when the banking crisis hit in 2008 and 2009. The State spent €34.5 billion to prop up these banks but has only recovered €1.1 billion thus far, making the remaining €33.4 billion a sunk cost in the realm of finance and business.
