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Ireland OKs Bill To Shields Banks, Deposits

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The Associated Press

Published: October 3, 2008

DUBLIN, Ireland - Irish lawmakers approved a comprehensive bank guarantee Thursday that grants taxpayer protection to all deposits and debts of Irish-owned banks.

The sweeping deal commits Ireland to insure unlimited deposits and the interbank debts of six Dublin-based institutions totaling 440 billion euros ($600 billion) for the next two years.

Lawmakers in both houses of parliament overwhelmingly backed the emergency bill after 30 straight hours of debate - their first round-the-clock session since 1984.

President Mary McAleese formally signed the bill into law.

Irish bank shares surged for the third straight day in celebration of a government policy designed to strengthen deposits and reassure foreign financiers that it's safe to lend money to Irish banks.

The Irish Stock Exchange was 5.3 percent higher in afternoon trading, leading European bourses.

But Ireland's left-of-center Labour party complained that the government should have punished Ireland's banks for lending recklessly and rewarding themselves too richly.

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