Michael Noonan (Limerick City, Fine Gael) | Oireachtas source

Negotiations are ongoing and progress has been made insofar as people are coming to a better understanding of their positions and moving towards a mutual understanding of the situation. In terms of process, we are separating the timeline on the promissory note and recapitalisation of the banks because, as the Deputy said, on 29 June, it was a condition of any direct recapitalisation of banks that the European supervision system would be put in place first. However, from our perspective, when the objective is to get back into the markets at low interest rates, the actual date of the recapitalisation, if and when it comes about, is not the relevant date. What is relevant is the definitive statement that it is going to happen because as soon as that is done, it would be priced in to the cost of Irish paper. As a consequence, we could avail of that. To a large degree, that has already been done. The statement of 29 June was priced in and was interpreted as that in the future, the Irish debt position will be more sustainable. After the Helsinki statement by the three finance Ministers, our nine-year bond went up about 20 basis points and our five-year bond went up about 10 basis points. However, that has all come back so the markets are convinced from the way they are pricing Irish paper that the commitment of 29 June holds. I do not know what is the intention of the Heads of State and Government at the next meeting. I believe it will be made clear that what has been agreed is agreed but I do not know whether that will be formally expressed.

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