Four Irish Banks - Bank of Ireland, Allied Irish Banks, Irish Life Permanent and the Educational Building Society - are to undergo strict stress tests this week. The tests aim to assess the real extent of the bank's debt losses.

In an attempt to strengthen the independence and transparency of the process, the Irish Central bank has made it impossible for these institutions to challenge the future findings of these tests.

The tests are expected to reveal a further lack of lender capital of between €18bn and €23bn. This would increase the necessary amount of state injections to these banks from the original €46bn, to a sum between €64 and €69bn.

The news also heightened long-standing speculation that the €35bn package lent to Ireland by the European Union (EU) and the International Monetary Fund (IMF) will not suffice to cover for the banks' losses. European commissioner for economic affairs, Olli Rehn, said he had "reason to believe that the financial assistance programme would not be sufficient".

The tests will focus on residential and buy-to-let mortgages on properties purchased at the height of the real estate boom. Another test will look at the attempt to assess how much these banks need to offload in order to fund themselves through customer savings rather than through borrowing.