The European Central Bank expressed concerns that Irish bail out would affect Ireland’s ability to provide further funding to Eurozone members. The ECB is of the view that Ireland lacks quality collateral for bail out loans in case Ireland fails to pay back those loans.
On Friday, credit rating agency Moody’s cut sharply the Republic’s debt rating reducing it by five notches. Last week, the International Monetary Fund (IMF) approved a three-year loan of 22.5bn euros for the Republic. The funds form the first part of the IMF’s contribution to the EU and IMF rescue package. The Irish government has passed a series of spending cuts and tax rises totalling 15bn euros as a condition of the bailout.