Rescue funds chief backs easier repayment terms for Ireland

The head of the eurozone rescue funds, Klaus Regling, signalled he backs easier repayment terms for Ireland and Portugal, saying it may speed their return to financial markets.

The option being discussed for the two bailed-out countries only involves extending maturities, in contrast to Greece, Mr Regling said in an interview with Spiegel magazine posted on its website.

“Unlike Greece, Ireland and Portugal want no suspension of debt servicing and interest payments, but rather only longer maturities on one part of their loans,” said Mr Regling, who leads the permanent €500bn European Stability Mechanism and the temporary European Financial Stability Facility.

“That could help them to return earlier to the market. That in turn is in all our interests.” Mr Regling also reiterated that the ESM won’t provide aid directly to banks except as a last resort, and then only after the European Central Bank has assumed its new responsibilities as single bank supervisor for the eurozone.

He said the ESM has more than €400bn available for future rescue efforts, which could include direct recapitalisation. Ireland and France led calls for the new tool to be ready as quickly as possible.