Bank of Ireland, Allied Irish may show halt in deposits flight*******

DUBLIN, Apr 11 (Bloomberg): Bank of Ireland Plc and Allied Irish Banks Plc (ALBK), the Republic's two largest banks, will this week show if regulators are succeeding in staunching the outflow of deposits triggered by the country's financial crisis. Ireland's six biggest banks have lost about a third of their deposits since the end of 2008 as the country was forced to seek a bailout, according to the Irish central bank. Bank of Ireland and Allied Irish will disclose their deposits when they report combined annual losses that analysts estimate will total a record 10 billion euros ($14.4 billion). Regulators last month ordered the two banks to raise 18.5 billion euros of additional capital following a stress test aimed at ending the country's financial crisis. The Dublin-based banks are relying on emergency funding from the European Central Bank as customers pulled deposits and investors shunned their debt. The two banks get about half their funding from deposits. "The new proposed capital levels will be very comforting for depositors," said Niall O'Connor, a London-based analyst at Credit Suisse Group AG with an outperform rating on the two banks. "From a foreign point of view, what is going out has probably already left." Finance Minister Michael Noonan said April 6 net deposits at the two lenders "improved significantly" after the stress tests, without giving details. Bank of Ireland shares have climbed 35 per cent to 29.6 euro cents in Dublin trading the tests on March 31. Allied Irish climbed 48 per cent to 28 euro cents in the same period. Depositors pulled money last year as the country's credit rating was reduced on concern the government wouldn't be able to afford the cost of bailing out its banks. Ireland's bill to rescue the banks may reach as much as 100 billion euros.