THE EUROPEAN UNION has today issued a €3 billion bond to pay for the latest instalments of the bailouts of Ireland and Portugal.
One third of the proceeds will fund the €1 billion in loans that were approved to Ireland under the last quarterly review of its bailout programme.
The bond, which matures in 15 years, achieved an average yield of 2.621 per cent – barely over half of the interest rate that Ireland would be charged to take out a similar loan by itself.
The funds will be passed on to Ireland and Portugal without any extra profit margin being added by the EU.
The auction was carried out by the European Commission on behalf of the EU under the European Financial Stability Mechanism.
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