Central Bank figures published on Friday showing the amount of emergency liquidity assistance it has given to the banks provides a insight into Irish banks' insolvency.


By the end of last month, the amount in emergency assistance it provided the banks rose to €51bn. That's up from €44.6bn in November and from €34.6bn at the end of October. Evidently, the liquidity crisis for the banks, as their deposits flow out the door, is showing no sign of easing.


The banks needed the Central Bank's emergency loans because the European Central Bank was not prepared to lend them the cash due to the fact that the assets they were offering in return were not of good quality.


Separately, the ECB by the end of 2010 had provided the Irish banks with another €136bn, down slightly from €132bn at the end of November, in loans that were backed with acceptable security.


We do not know which banks or what amounts they received in emergency assistance or the quality of the assets (if any) they pledged in return because the Central Bank will not say. The Financial Times has described the loans as "secretive funding".


Financial researcher Lorcan Roche Kelly, who first uncovered the emergency lending figures buried deep in the monthly statements, says that when Anglo and Irish Nationwide are wound up, the Central Bank will be repaid a big chunk of its emergency cash. Still, that will probably leave, he guesses, several billion euro that AIB, and possibly Bank of Ireland too, have received from the Central Bank.


Roche Kelly said it was a bad sign that the amount of emergency loans was not falling. And the significance of the loans? "They are stopping the banks going bust at the moment," he said.