Doubts have been cast over the Government's ability to secure a deal to shift some of the €64bn cost of bailing out Irish banks on to the European bailout fund.
It is seen as the second element of the Government's plan to renegotiate the banking bailout. The first part was spreading out the €31bn Anglo Irish Bank promissory notes.
US banking giant JP Morgan said yesterday that such a deal for Ireland is now unlikely.
Irish negotiators want to share some of the cost of the banking bailout by getting the European Stabilisation Mechanism (ESM) to buy stakes in bailed-out banks that are currently owned by taxpayers.
Taoiseach Enda Kenny admitted yesterday a previous target to have an agreement by next June was now unrealistic, but said the Government was pushing for a deal.
The Government has previously said a deal could be reached on how the bank stakes will be treated by the middle of this year, even if it is not possible to actually conclude a sale until a new European banking regulator is up and running.
"In reality this will not become, and cannot become, effective until very late this year or into 2014.
"I don't underestimate the scale of the challenge of those negotiations or how complex they might actually be," Mr Kenny said yesterday.
Even that could be optimistic, according to JP Morgan. In a note to investors, its economist Malcolm Barr said the ESM was unlikely to purchase taxpayers' stakes in the banks in the coming years.
The bank's "base case" for Ireland was that the ESM wouldn't purchase legacy banking assets over the next couple of years, it said.
However, on a more positive note he said Ireland was likely to be given more time to repay our EU bailout loans.
Growth, and a significant primary market surplus, will determine Ireland's medium-term debt sustainability, he said.