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Hollande backs debt deal for Ireland

Monday, October 22 17:23:07

Taoiseach Enda Kenny has picked up a supporter in his efforts to secure a bank debt deal for Ireland with French President, Francois Hollande today saying that Ireland needs to be treated as a special case.

"Ireland is a special case and deserves to be treated as such," Mr. Hollande said after a meeting with the Taoiseach in Paris. Mr. Hollande's words echoed those of German Chancellor Angela Merkel, who said over the weekend that the euro zone would look at Ireland's plans to lessen the huge debts it had amassed saving stricken banks as a "special case."

The endorsement of the leaders of the euro zone's two largest economies breathes fresh life into Ireland's efforts to shift some of the debt incurred recapitalizing its banks off its sovereign balance sheet.

The comments came after a weekend of confusion following remarks made by Ms. Merkel that had appeared to torpedo Ireland's hopes to get the euro zone to finance the huge costs it accumulated saving formerly private banks. Ms. Merkel had taken a hard line Friday at the end of a European leaders' summit in Brussels on Spain's hopes that the euro zone would finance the debts the country incurred in recapitalizing its lenders during the euro-debt crisis.

"There will be no retroactive direct bank recapitalization [for Spanish banks]," Ms. Merkel told reporters in Brussels.

Her comments appeared to dash Dublin's hopes to get the European Stability Mechanism, the euro zone's permanent rescue fund, to refinance some of the huge costs Ireland incurred in saving its broken banking system during the past four years.