Early repayment of €8bn in post-crash loans could save exchequer €90m

The Irish Cabinet is considering paying down about €8 billion in loans Ireland took on after the financial crash, a move officials have calculated could save the exchequer €90 million.

The government is looking at repaying portions of loans under the European Financial Stabilisation Mechanism next year and in 2028, along with €3 billion due in 2032, €2 billion due in 2035 and €3 billion due in 2036. Repayments would be spread out rather than made in a single payment. To retire the debt early, the state would issue new bonds.

Ireland holds just over €15 billion in EFSM loans. The facility supplied financial assistance from the European Commission to Ireland and Portugal from 2011 to 2014, tied to economic reform conditions, and also extended short-term loans to Greece. No decision has been made, and any repayment would depend on whether it makes financial sense at the time. The EFSM programme closed to new lending in 2014.

The EFSM lent to Ireland, Portugal and Greece between 2011 and 2014, with funds from the European Commission conditioned on economic reforms. Ireland's holdings under the mechanism total just over €15 billion. Officials said any repayment would be spread across dates rather than made in a lump sum, and would require new debt issuance to retire the existing loans. No final decision has been taken; the timing would depend on whether the move is financially beneficial at that point. The EFSM provided assistance to Ireland and Portugal from 2011 to 2014, with funds conditioned on economic reforms, and also issued short-term loans to Greece. Ireland holds just over €15 billion in EFSM debt. Repaying early would require issuing new debt. The Cabinet discussed the option Wednesday, and no final decision has been made, with any move contingent on whether it proves financially beneficial at the time.

The EFSM provided financial assistance from the European Commission to Ireland and Portugal between 2011 and 2014, with funds conditioned on economic reforms. Short-term loans were also issued to Greece under the arrangement. Ireland holds just over €15 billion in EFSM loans. Repaying part or all of the €8 billion would require the government to issue new debt. No final decision has been taken, and the timing would depend on whether such a move is financially beneficial at that point.