Highlights: Ireland government statement on rescue deal

DUBLIN (BestGrowthStock) – Following are highlights from the Irish government’s statement on its bailout loan package with the IMF and European Union.

SIZE OF BAILOUT

The fund will total 85 billion euros, 17.5 billion of which will be contributed by Ireland itself.

This will include:

* 50 billion euros to fund Irish budget

* 35 billion euros to recapitalize banks, including 10 billion immediately and 25 billion as a contingency fund.

INTEREST RATE

“If drawn down in total today, the combined annual average interest rate would be of the order of 5.8% per annum. The rate will vary according to the timing of the drawdown and market conditions.”

PURPOSE OF BAILOUT

“The assistance of our EU partners and the IMF has been required because of the present high yields on Irish bonds, which have curtailed the State’s ability to borrow. Without this external support, the State would not be able to raise the funds required to pay for key public services for our citizens and to provide a functioning banking system to support economic activity.”

QUARTERLY PROGRESS REPORTS

“The funding will be provided in quarterly tranches on the achievement of agreed quarterly targets.”

“The Programme has two parts — the first part deals with bank restructuring and reorganization and the second part deals with fiscal policy and structural reform. The requirement for quarterly progress reports covers both parts of the programme.”

EXTRA YEAR TO REACH 3 PERCENT DEFICIT TARGET

EU ministers have given Ireland an extra year — until 2015 rather than 2014 — to reduce its budget deficit to 3 percent.

“This analysis is based on a more cautious growth outlook in 2011 and 2012 and the need to service the cost of additional bank recapitalizations envisaged under the programme.”

IRELAND TO STOP CONTRIBUTING TO GREEK BAILOUT

“Ireland will discontinue its financial assistance to the loan facility to Greece. This commitment would have amounted to approximately 1 billion euros up to the period to mid-2013.”

(Dublin newsroom)

Highlights: Ireland government statement on rescue deal