IL&P chief executive Denis Casey

Irish Life & Permanent (IL&P) has the dubious honour of being the first of the listed Irish financials to issue a post-guarantee trading statement this Thursday. It is an epic understatement to say investors will be watching carefully.

Top of the list of concerns for shareholders will be an update on the group's access to bank funding. Credit markets remain largely frozen: funding is short-term and for small amounts at high cost. This situation, while bad for banks in general, has been a particular problem for IL&P due to its over-reliance on wholesale funding to keep its wheels turning.

Investors will welcome any sign that debt – and not just ECB emergency lines – is becoming available again at longer maturity and with greater certainty. Reportedly people within IL&P's treasury operations have noted increased interest from possible funding sources, which may explain last week's anomalous share-price gains.

On the capital front, market watchers are no doubt expecting further detail on the release of technical capital reserves from the life side, as flagged by chief executive Denis Casey at the group's interim results presentation in late August. Up to €1.5bn may become available through securitisation and reinsurance transactions over the next couple of years.

The sectoral trend in earnings has been negative so far this year and early indications from other institutions – such as National Irish Bank – suggest it is going to get much worse soon. However IL&P's mortgage loan book is considered high-quality and the banking side has no exposure to property development or land speculation. Rising bad debts might just appear in the UK buy-to-let business, although the most recent figures put losses below the market trend.

Even if credit impairments remain relatively low, there will be no sign of lending growth as long as funding remains scarce and loans-to-deposits remain grossly imbalanced.