TheJournal.ie uses cookies. By continuing to browse this site you are agreeing to our use of cookies. Click here to find out more »
Dublin: 9 °C Sunday 30 April, 2017
Advertisement

EU issues €3 billion bond to fund Irish and Portuguese bailouts

€1 billion of the funds – which were sold at an interest rate of 2.621 per cent – will be sent to Ireland.

Image: Yves Logghe/AP

THE EUROPEAN UNION has today issued a €3 billion bond to pay for the latest instalments of the bailouts of Ireland and Portugal.

One third of the proceeds will fund the €1 billion in loans that were approved to Ireland under the last quarterly review of its bailout programme.

The bond, which matures in 15 years, achieved an average yield of 2.621 per cent – barely over half of the interest rate that Ireland would be charged to take out a similar loan by itself.

The funds will be passed on to Ireland and Portugal without any extra profit margin being added by the EU.

The auction was carried out by the European Commission on behalf of the EU under the European Financial Stability Mechanism.

The ESFM is contributing €22.5 billion – or one third – of the €67.5 billion Ireland is receiving under the current funding package. After the €1 billion raised today is passed on, there will only be €800 million left to collect from the EFSM.

Borrowers from Germany and Austria took up 31 per cent of the loans, followed by the UK with 25 per cent and the Benelux countries with 12 per cent. Swiss borrowers took up 10 per cent of the loans.

Read: Taoiseach coy on content of telephone chat with Angela Merkel

  • Share on Facebook
  • Email this article
  •  

Read next:

COMMENTS (23)

This is YOUR comments community. Stay civil, stay constructive, stay on topic. Please familiarise yourself with our comments policy here before taking part.
write a comment

Leave a commentcancel