Irish lawmakers voted through emergency legislation to liquidate the former Anglo Irish bank early Thursday, as part of a deal to ease the eurozone country's massive debt burden.
Weary lawmakers voted in the small hours to liquidate the failed bank, now known as the Irish Bank Resolution Corporation (IBRC), by a majority of 113 in favour to 36 against.
Its assets will now be bought out by Ireland's state run "bad bank", the National Asset Management Agency (NAMA), which buys risky mortgages from debt-plagued lenders.
Finance Minister Michael Noonan was forced to announce the emergency bill overnight after details of the plans were leaked, sparking fears there could be a rush to offload the bank's assets.
"As soon as the information relating to the proposal to liquidate IBRC was made public, there was an immediate risk to the bank," Noonan said.
"Given this position, I as minister for finance, took immediate action to secure the stability of the bank and the value of its assets, valued at 12 billion (euros), on behalf of the state."
Accountancy firm KPMG has taken control of IBRC after its board was stood down on Noonan's orders on Wednesday afternoon.
The bank's assets, which include those of the Irish Nationwide Building Society, will be purchased by NAMA under a plan aimed at improving the terms of Ireland's banking debt.
In particular, Ireland is seeking to lessen the burden from a 31-billion-euro ($41.9 billion) promissory note -- effectively a high-interest IOU that was pumped into Anglo Irish to rescue it during the financial crisis.
The government, which was forced to seek an 85-billion-euro bailout from the EU and IMF in 2010, wants to scrap the promissory note and replace it with a long-term bond to stretch out the repayments.
Dublin already issued a long-term bond last year to ease the pressure on its finances.
But changes to the promissory note hinge on the support of the European Central Bank (ECB).
The governor of the Irish Central Bank, Patrick Honohan, was negotiating the deal with ECB officials late Wednesday ahead of a formal meeting on the issue on Thursday.
Noonan stressed early Thursday that there had not been "any deal done" so far on the promissory note.
Lawmakers did not even begin debating the Anglo Irish liquidation plans until after midnight at a special late sitting of Ireland's Dail, or parliament, and finally voted the bill through just before 0230 GMT.
Ireland's President Michael D. Higgins cut short a state visit to Italy late Wednesday to fly back to Dublin and study the legislation.
Several lawmakers criticised the bill's hasty timeframe, with Socialist Party leader Joe Higgins describing it as "chaotic".
Noonan said all employment contracts at IBRC would be immediately terminated but that many staff could be rehired to assist the liquidator.
Prior to the emergency bill, IBRC was already in a process of winding up -- set to be achieved by 2020 -- with the vast majority of deposit accounts already transferred to other Irish banks.
In 2010, Anglo Irish posted a 17.65 billion euro loss, the largest corporate loss in Irish history.
The bank has become synonymous with the harsh realities of Ireland's economic downturn.
The country's once-proud 'Celtic Tiger' economy, famed for its double-digit growth for a decade from the mid-1990s, has contracted sharply in recent years, hit by a property market meltdown, soaring state debt and high unemployment.
Ireland's government has imposed six consecutive austerity budgets involving painful tax hikes and spending cuts.
Irish Prime Minister Enda Kenny said the liquidation of Anglo Irish was a significant milestone in Ireland's "path back to prosperity and full employment".
"It closes a sad and tragic chapter in our economic and political history," he said.
But he added: "Let there be no doubt that this decision is not a silver bullet to end all our economic problems. The damage done by these economic institutions will take many years to rectify."
Anglo Irish's former chairman Sean Fitzpatrick and two other senior executives are due to go on trial next January in connection with alleged financial irregularities.