Ireland expecting loan worth ‘tens of billions’

Central bank governor discusses ‘substantial’ financial help.

The governor of Ireland’s central bank has given the first official indication that Ireland will receive loans from the EU and the International Monetary Fund to help it deal with its banking crisis.

Patrick Honohan said this morning that he was expecting a “very substantial loan” from the EU and the IMF that would run into “tens of billions” of euros.

He told state broadcaster RTE: “It’s my expectation that will happen, yes… absolutely. It will be a large loan because the purpose of the amount to be advanced or to be made available to be borrowed is to show Ireland has sufficient firepower to deal with any concerns of the market.”

Honohan was talking as representatives from the European Commission, the IMF and the European Central Bank (ECB) arrived in Dublin to examine the country’s finances.

He said: “The ECB would not send large teams if they didn’t believe first of all that they could agree to a package, that there is a programme that is fully acceptable to them that could be designed, and that it is likely to be acceptable to the Irish government and the Irish people.”

“We’re talking about a very substantial loan for sure – tens of billions, yes,”

European stock and bond markets and the euro today recovered slightly for the first time in 10 days in the hope that Ireland would become the second eurozone country after Greece to receive a bail-out.

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