THE six banks covered by the government guarantee still had more than €10bn of outstanding subordinated debt at the beginning of January.

The figure includes junior debt issued by AIB, which last week began a voluntary offer to buy back €4.1bn of its €4.77bn of outstanding subordinated bonds.

According to figures supplied by finance minister Brian Lenihan in response to a parliamentary question from Labour's Jack Wall, Bank of Ireland still had €2.8bn of subordinated securities in issue.

Irish Life & Permanent, which has not required a state capital injection, had €1.4bn of this debt in issue and Anglo Irish Bank had €768m. The two building societies, EBS and Irish Nationwide, had outstanding subordinated debt of €213 and €171m respectively.

Under tough new rules introduced by Lenihan before Christmas he can force the holders of the bonds to take swingeing losses if they refuse any offer by the banks to buy them back at a discount to their face value.