Lagarde Says IMF ‘Open Minded’ on Irish Exit Bailout Concessions
International Monetary Fund Managing Director, Christine Lagarde said she has an “open mind” on how Ireland can be best helped exit its bailout program, as European Union leaders discuss extending its aid loans.
Lagarde said alternatives are available other than simply extending loans, adding that the IMF remains “on call” for Ireland as it leaves the program.
“It is not just about extension of maturity,” she told reporters in Dublin today. “You can think of other devices possibly but certainly it includes the extension. We will look at it together with the other two partners in the troika.”
EU finance ministers are discussing a plan that would allow Ireland to extend the maturities on some loans to ease repayment costs and help the countries regain full market access. Ireland is aiming to exit its bailout program, which it entered in 2010, by the end of this year. The IMF provided 22.5 billion euros of the country’s 67.5 billion euro-rescue.
“The IMF is a multilateral institution that has to operate on a completely even-handed manner and very much on the basis of the rule of law,” she said. “We don’t invent new terms and new policies on an adhoc basis.”
Last year, Irish Finance Minister Michael Noonan raised the possibility of a precautionary credit line being provided to the government as it makes a full return to international markets.
Moody’s Investors Service said yesterday the European plan to consider extending maturities on some Irish bailout loans is “very significant.” The EU may reschedule at least 10.5 billion euros of Irish rescue loans due to mature in 2015 and 2016, Dublin-based securities firm Davy said.
The yield on Ireland’s bonds maturing in October 2020 fell 4 basis points to 3.68 percent today.
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