The Irish government intends to inject up to 4 billion euros into Anglo Irish Bank, subject to European Union approval.
AIB has reported a pre-tax loss of 4.1 billion euros in the six months to March compared to a year earlier. The bank was nationalised by Dublin in January.
In a statement on Friday Finance Minister Brian Lenihan said the government's overriding concern was to "protect the economy" from the wider losses that would occur in the event of the failure of the bank.
It would also "protect" 64 billion euros of customer and interbank deposits.
He described the bank's interim loss caused by write-offs linked to a property market slump as "extremely disappointing."