RATINGS agency Moody's yesterday said last week's solution to a €3.1bn payment owed to the former Anglo Irish Bank was a "credit positive" for Ireland, but a "credit negative" for the bank.
The comments came as the National Treasury Management Agency issued Irish Bank Resolution Corporation (formerly Anglo) with a sovereign bond worth €3.1bn yesterday morning.
Moody's said the agreement to pay IBRC with a bond rather than in cash was positive for the country as it "reduces Ireland's gross borrowing requirements in 2012".
"The transaction is credit negative for IBRC because it will not directly receive the €3.1bn of cash," it added.
IBRC will turn the bond into cash using a one-year 'repo' deal with Bank of Ireland.
Moody's points out that IBRC will have to repay the cash to BOI at the end of that year unless a broader deal on Ireland's bank debt has been done by then.
"Given Ireland's goodwill among European institutions and because of its compliance with fiscal targets, we expect a more comprehensive restructuring of the promissory notes (IOUs) later this year," the ratings agency added.