DUBLIN, Ireland - March 31, 2010 - The Bank of Ireland laid bare the depth of its crisis today as it reported a fall of nearly €3 billion (£2.6 billion) into the red in the first nine months of its financial year.

The bank added that had written down the value of loans to customers by more than €4 billion and that it would need to raise €2.7 billion to shore up its balance sheet.

While the level of writedowns is thought to have peaked, Richie Boucher, the chief executive, admitted that there there was no relief from the crisis in the Irish economy.

The Irish Government has said that it will inject €20 billion of new funding needed across the industry to keep it afloat. That is in addition to the creation of the National Asset Management Agency (NAMA), a so-called "bad bank" in which struggling finance houses can dump €16 billion of their most toxic lending.

Mr. Boucher said he that believed a fundraiser of €2.7 billion would be sufficient to meet Bank of Ireland's capital requirements.

Bank of Ireland's interests in the UK include running the banking products and credit card services of the Post Office.

For the nine months to the end of December the bank reported an underlying operating profit of €1.05 billion. That was wiped out, though, by €4.05 billion of impairment charges on loan assets, €2.23 billion of which is destined for NAMA. The underlying pre-tax loss for the period came in at €2.97 billion.

Mr. Boucher said: "There was a further contraction in the level of economic activity across our core markets in Ireland and the UK and difficult economic conditions globally.

"With hindsight it is clear that the bank's growth ambitions in previous years had been framed against an overly optimistic view of the outlook for the Irish economy and it was too exposed to the property sector and too reliant on wholesale funding."