Ministers play down German debt statement

Government ministers have rejected suggestions that statements by Germany’s chancellor Angela Merkel on bank debt have sunk hopes of a deal for Ireland.

However, the opposition accused the Government of misleading the country over whether the EU’s rescue fund would take over backdated Irish bank debt.

Finance Minister Michael Noonan said EU states had made commitments at this week’s EU summit to abide by a statement in June, which pledged to separate sovereign and bank debt.