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Irish banks have various options to raise capital, Minister for Finance Brian Lenihan said today, as speculation mounts over possible investment in the lenders by private equity groups.

"We are anxious to secure private funding for the banking sector," Mr Lenihan said today.

"Naturally it gives rise to debate as to whether it's a private equity funding base, a realisation of assets or subscription of shares," he said.

"There are various options for raising private capital for banks," the Minister added.

Last week, Bank of Ireland said it had received unsolicited bid approaches from unnamed groups.

Mr Lenihan reiterated that "total state investment" would be a "last resort" and said that in any move the public interest would have to be safeguarded.

Yesterday, the Irish Bank Officials Association said private equity investment would be a "disaster" for Irish banks and the economy.

"I do not agree with the characterisation of investors as predators or parasites," Mr Lenihan said.

Reuters