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Allied transferred loans to the national agency management of assets controlled by the State, with an average discount of about toxic debt holder 60pc at the nominal value of the debts.

Transfer came as a ratings agency Moody took five - notch decommissioning week last Irish sovereign debt with the decommissioning of most major financial institutions in the country.

Debt issued by Allied forces, Bank of Ireland, EBS Building Society and the lives of Irish & standing was marked by between three and five notches by Moody. Ratings agency said that more downgrades monitor and put a "negative" perspectives on debt banks.

?Moody provides that in the foreseeable future, the Irish banks are likely to continue to face very difficult conditions in the wholesale markets and will therefore continue to rely on the financing of the Central Bank?, said the agency ratings.

Downgrades come despite the pumping billion € of new capital in banks, but also another € will be used for emergency funding agreed the month last for a bailout package of €85bn Ireland by the European Union and the international monetary fund.

Irish banks were the largest individual borrowers in the euro area, and before the refloating had become increasingly more dependent of the European Central Bank (ECB).

By Ireland, calls have been for the country and its banks back their debts, and the Government is currently developing new legislation allowing politicians forcing losses on the holders of bonds in the processes of the burden-sharing.

The ECB position paper published last week said he had "serious concerns" about the implications of the new legislation.

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Unpopular coalition Government hopes to obtain the most difficult budget in the history of the country passed with only a majority of two places, once it was unveiled in the Dail, the Irish Parliament this afternoon.

Unlike the usual procedure for next year's figures have been widely reported, because they are part of the plan quadrennial "national recovery" published last month.

The Government hopes all of spending cuts and tax if student reduce alarming budget deficit the Ireland 9 1pc of domestic product gross country (GDP) in 2011 and below the European objective of 3pc by 2014.

Policy measures are highly "frontloaded" - a condition of the Ireland receive its 85bn package € international support - 40pc or €6bn savings destined him only next year.

Of this €6bn, shoot approximately two thirds of the reductions in public expenditure and much of the rest in tax rises.

Public spending cuts break in a reduction of 2 euros of current (recurring expenditures rather than one-time expenditures), while capital billion or capital expenditure takes a beating from 8bn €1.

Some support for €1 raised through taxes is the rest of the figure €6bn for 2011.

In terms of exactly how these savings will be achieved, many specific austerity measures have been announced by four-year plan as a reduction in immediately to all new employees in the public sector pay 10pc.

The minimum wage is with €1 to €7.65 an hour, while that social assistance payments are also reduced.

The income tax system is overhauled so that more workers will contribute, and higher rates, projected to stimulate public revenues of more than 1 €5.3 in 2011 only.

Next year will also see various tax exemptions, such as patents, defunct royalty.

Finance Minister Brian Lenihan should also to cut pay for senior officials and politicians.

A project social legislation giving legal effect to any change in budget for unemployment benefit or child should be voted on the weekends.

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Protesters burn an image of Prime Minister Brian Cowen the Ireland in front of Leinster House in Dublin.?Photo: Reuters

In a note describing the prospects for 2011 for European banks, analysts of Deutsche Bank said sovereign concerns "at the top of the agenda.

"We expect this process to continue at the beginning of 2011, as economics team Deutsche Bank believes that the Portugal is very likely to exploit the IMF / EU (ESFS) rescue mechanisms year prochaine.Mais we believe that the Domino should stop down Spain.".

Colleagues income fixed at Deutsche said in a note Monday that they were not at all surprised to see the concerns on the Spain rising again.

"The market seems to think that it is inevitable Portugal request assistance then - maybe in January?"-and then after Spain will be examined with a fine tooth comb in the coming months.Doing work for the future we growing arrived to the conclusion that if you think that the sovereign decision of problems of Greece, the Ireland and perhaps Portugal depends on whether you think it is a problem with the financial system across the West, or if you think that's only a problem with the individual over leveraged entities.?

Simon Samuels, Barclays Capital analyst said in a note last week:

"" The Irish crisis and subsequent salvage returned sovereign concerns to the forefront the spirit of the investisseurs.Mais is it simply the case that some harsh comments of Angela Merkel did bond investors run coverage? we do not believe. ""

He added:

"In short, the Irish sovereign has been dismembered by its banking system...."In September, Irish banks to share repurchases of € will form the Government guaranteed debt.While the Government could (and has) extend this warranty as Iceland in 2008, it seemed no more credible on the market, bond issues becoming nerve, and the system has begun to implode.?

Written on the subject which could be then, he said:

"Our esteem Spain challenges remain considerable - the probability of a positive result poor so that at least the sovereign and the banks have successfully navigated travelled to wire the funding hump faced in 2011 both printemps.Les asset quality quotation marks will probably last much more longtemps.En however, we are much more optimistic on Italian perspective .the ' lack of assets and large bubble limited funding dependence suggests that banks have little additional risk to the Italian sovereign."

He added:

"Many commentators have suggested that the Spain is too large to be admitted to concrete plans on how to solve a real Spanish crisis remain opaque .Tandis failure, should materialize the Spanish the tail of a surety risk off, it is likely that the French and German economy (more) will be the largest share of saving the Spain and, by extension, the euro zone."

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