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EU says raising 15.3 bln euros for Portugal, Ireland by July

The European Union will seek to raise 15.3 billion euros for Portugal and Ireland in the next three months to fund rescue loans for the two eurozone nations, the EU said on Thursday.

The announcement came two days after EU finance ministers approved a three-year, 78-billion-euro ($111 billion) bailout for Portugal under a programme that requires Lisbon to slash spending and sell public assets.

Ireland was granted its own 67.5-billion-euro bailout late last year after a banking crisis blew a massive hole in its public finances.

The EU and its core eurozone bloc will use two top-rated financial mechanisms to conduct various borrowing operations for the two nations between May 23 and July 15.

The instruments issued for the two countries “should be mainly in standard benchmark maturities of five to 10 years denominated in euros,” the EU said in a statement.

The International Monetary Fund will provide “complementary disbursements” as agreed under the joint EU-IMF rescues for both nations.

It will be the first operations for Portugal while funds have already been raised for Ireland.

EU authorities said they had decided to add Portugal to its issuance calendar for Ireland in order “to ensure smooth market operations over the entire duration of the support programmes.”

Portuguese Finance Minister Fernando Teixeira dos Santos said on Tuesday that Portugal expected to pay an average interest rate of 5.1 percent on the 78-billion-euro bailout funds.

Ireland has failed so far to convince European partners to reduce its average 5.8 percent interest rate.

The 17-nation eurozone has struggled to contain a year-long debt crisis that began last year when Greece became the first nation in the single currency area’s history to need a bailout.