Ireland needs more time to repay bailout: central bank head

8th December 2012, Comments 0 comments

Crisis-hit Ireland needs more time to repay its bank bailout funds, the eurozone member's central bank governor Patrick Honohan said in an interview with a German daily Saturday.

Honohan told the Frankfurter Allgemeine Zeitung that the government was trying to win back financial market confidence and the current repayment plan was complicating that endeavour.

Ireland's banks were hammered by the collapse of the country's real estate sector in 2008, forcing the country to request aid in late 2010 from the European Union, the European Central Bank and the International Monetary Fund.

Dublin has received aid worth 85 billion euros ($110 billion), to which draconian conditions were attached, with a large chunk of the bailout going to the nation's troubled banks.

Honohan, who is also a member of the ECB governing council, insisted that the funds would be paid back but that the timeline needed to be extended considerably.

Ireland, which has won praise from EU-IMF auditors for constantly hitting fiscal targets, on Wednesday unveiled its sixth austerity budget, which included painful tax hikes and public spending cuts.

© 2012 AFP

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