PRODUCT PROFILE

Latest Dublin Prices

Gov ask for more cash post-bailout

Thursday, October 25 14:45:07

The Minister for Finance Michael Noonan has spoken to the Troika about additional funding when the bailout finishes, he said today.

He made the comments after the Troika passed its latest bailout review - its eighth - but he insisted the government would not need to actually tap in to the funds.

Mr Noonan said the government was likely to mark down its growth forecasts for 2013 next week, but said he did not expect this to effect the government's fiscal targets. The government currently expects GDP growth of 2.2 percent next year.

The government is also seeking clarity from the European Central Bank about whether it could theoretically tap the bank's new bond-buying programme to offer additional assurances to investors.

Ireland has made a tentative return to the bond market in recent months, the only EU/IMF bailout recipient to do so, but is looking for any help it can get to boost confidence enough to allow a full market return when its bailout expires late next year.

"We had a short discussion ... on which assistance on exit would be available from the European authorities and the answer was 'Yes'," Noonan told journalists in Dublin following the end of the latest 10-day EU/IMF review.

"What we want to see is the range of possible options that will be there. We are hopeful we will not have to use any of these."

Noonan said Ireland would not need another bailout. "There is no question," he said.

A statement from the European Central Bank that Ireland could in theory access the ECB's Outright Monetary Financing programme would help the Government to avoid actually tapping any official help, Minister Brendan Howlin said.

"The simple assertion of that as a prospect would have an immediate impact on our bond spread," Howlin said.

Dublin is continuing talks with the European Commission and ECB to ease the burden placed on state finances by its failed lenders, with the aim of securing a deal before a 3.1 billion euro promissory note repayment in March next year.

Official support would help the government to tap bond markets over the coming year to build up a 17 billion euro ($22 billion) buffer, Noonan said, which would cover state funding for a year and a half.

"We would be prudent to say we would like 18 months' funding in hand," the finance minister said.