–Assures Parliament It Won’t Be ‘Three Figure’ Sum

FRANKFURT (MNI) – Irish Prime Minister Brian Cowen acknowledged in
parliament Wednesday that a figure of E85 billion is being discussed as
the amount of aid Ireland would receive from its European partners and
the IMF.

The Taioseach, as the Irish prime minister is formally known,
assured deputies in the lower house of parliament, the Dail, that the
final sum would not be “three figures.”

An amount “on the order of E85 billion has been discussed,” he
said.

The parliament’s question time was broadcast live on the web via
Ireland’s state broadcaster RTE.

Being interrogated by opposition Labour party leader Eamon Gilmore
on the details of the deal likely to be worked out, Cowen said, “we are
in the midst of discussions with these partners in relation to these
matters which are not finalized and I think it would be wrong for me to
preempt the outcome of those negotiations at this time.”

Addressing the rate of interest that Ireland would pay on any
prospective aid, Cowen said, “given that there are different sources of
funds”…any talk about a specific interest rate “is speculative at this
time.”

Turning to the state of the country’s embattled banking sector, the
prime minister emphasized that “no decisions in relation to bank
restructuring have yet taken place – none.”

“We know from the statements made by the European Union finance
ministers…that we need to build and intensify on the measures that
we’ve already taken, which have been supported,” he added.

“There are abnormal market conditions in place. We are out of the
markets. We have to establish a means by which we can at some stage get
back into the markets,” he said.

Cowen’s Fianna Fail party is currently on its last legs in a
coalition government with the Green party. Irish media reported
Wednesday that Cowen has promised to call an election in February once
the country’s Finance Bill has passed.

Markets are still on edge over the situation in Ireland. The spread
on Irish 10-year paper versus the benchmark German Bund is 26 basis
points wider today at +613 basis points, as investors await details of
Ireland’s critical four-year budget plan, due to be unveiled later this
afternoon.

Fianna Fail, the party that has historically been the governing
party of Ireland since the country became independent from the UK in the
early 1920s and whose leaders have been Ireland’s prime ministers
without interruption since 1997, is expected to take a pounding at the
next election.

The last election for the Dail was in 2007; the maximum term for a
legislative period is five years.

— Frankfurt bureau: +49-69-720 142; email: tbuell@marketnews.com —

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