“While some technicalities still need to be resolved [on the end-March payment], it now seems likely that this effort will be successful”, Patrick Honohan told a parliamentary committee. “I think it’s going to happen.”
Jean-Claude Juncker, Luxembourg prime minister and head of the Eurogroup of finance ministers, signalled his support for Dublin’s position, saying “there are good reasons for easing the burden”.
Dublin is planning to use a cheaper long-term bond to repay some of the debt owed by IBRC to the central bank instead of making the €3.06 billion cash payment due on March 31.
Mr Honohan said banking debt hung over the economic and financial recovery of Ireland and needed to be put on a more secure basis. He said finding a new way to fund these cash payments over a much longer period would “clearly help reduce this risk” to financial stability.
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