EU refuses to be drawn on Anglo Irish Bank fate

(BRUSSELS) - European competition authorities refused to be drawn on the fate of the Anglo Irish Bank on Monday after its chief executive told an Irish newspaper that Brussels wanted to shut it down.

"The case looking into state aid is still being examined," a spokeswoman for European Union competition commissioner Joaquin Almunia told AFP. A final verdict will be delivered "in a matter of weeks," she underlined.

The bank's chief executive Mike Aynsley said in an interview with Ireland's Sunday Business Post that Brussels wanted to wind down the lender.

"The European Commission is saying, this bank has dropped 25 billion euros and it doesn't deserve to survive,' and they're right. But you have a dysfunctional banking system," he was quoted as saying.

Prime Minister Brian Cowen warned earlier this week that winding up the bank immediately could cost more than 70 billion euros and that this would not be in the interests of the taxpayer.

Almunia said on Saturday he would discuss the matter with Finance Minister Brian Lenihan, who is due in Brussels on Monday, but did not say what was his preferred outcome.

Like many of its rivals, battered by the global financial crisis, a deep recession and a property market meltdown, the bank was nationalised in early 2009.

Last week, it reported a dizzying pre-tax loss of 8.2 billion euros in the six months to the end of June, on top of 12.7 billion euros for the whole of 2009, the biggest-ever losses in Irish corporate history.