Ireland to repay billions of bailout loans early to avoid hefty interest rates

Ireland is to repay billions of euro of bailout loans early in order to avoid €150m of interest.

The IMF chief Christine Legarde today gave the green light to a government plan to repay €4.5bn earlier than planned, while Sweden will accept €600m and Denmark €400m.

The state borrowed a total of €67.5bn in 2010 to avoid bankruptcy but the €3.8bn borrowed from the UK will not be paid back early.

Minister Paschal Donohoe says it would be too expensive to break the UK’s terms.

"The agreement that we have reached with the British government then was similar to a fixed rate morgage. There was a certain rate and a break clause in it," said Donohoe.

"I've been advised on this by the NTMA that if we were to trigger that break clause and repay back to the British government, the cost of that break clause would mean no savings to us. In fact, there would be a loss," he added.

Labour spokesperson on Finance Joan Burton said that she welcomed the move today.

"The Exchequer figures up to August show that €131 million less than budgeted has been spent on interest payments.

"The reality is that multi million euro savings have already been made on the National Debt, and this will add further to it. People should also be aware that the Exchequer is carrying €20 billion in liquid cash and assets," said Burton.

"It is time the Irish people saw the benefit of these savings," she added.

More in this Section

Judge slams involvement of Cork radio station with man who believed himself victim of vendetta

225 people caught speeding; including one doing 177km/h in 100km zone

Man arrested in connection with €1m Offaly drugs seizure due in court

'Not too late' to resolve Irish Rail strike: FF

Today's Stories

No Government jet for freed Halawa

Garda officers may sue for right to strike

Rail unions vote for industrial action

‘We are on our knees after this ... we need help’


A helicopter put a piano on the 150-foot roof of Blarney Castle and other stories from the Cork Jazz Festival archives

Jazz Memories: Famous faces share their favourite moments

Live music review: The Horrors - Icy genius in a thrillingly intimate setting

New book revisits the games they just don't make anymore

More From The Irish Examiner