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Noonan seeks to ease investor fears over bank debt

Finance Minister Michael Noonan tried to soothe investor fears over Ireland's massive bank debt saying there was "no urgency" to his plan to impose losses on some senior bondholders.

The minister spoke to influential financial institutions invited by the National Treasury Agency in New York yesterday in the wake of comments he made in Washington that created further problems for the euro.

Mr Noonan said his comments about burning senior bondholders at Anglo Irish Bank and Irish Nationwide were "given a weighting they didn't actually deserve" because of the crisis in Greece.

"We are saying publicly that everything that has been given to us as a country, or has been given to us in our banking system, that we'll repay to the last cent," he said.

However, he said that in the case of the recently merged Anglo and Irish Nationwide, there were "residual issues" Ireland would like to discuss given that the bank's deposit base had been moved to the main pillar banks.

"We are not going to make any kind of unilateral move," said Mr Noonan, "We are going to discuss these issues with the IMF, European Commission and European Central Bank."

At the meeting he stressed that only senior unsecured bondholders in the failed Anglo Irish Bank and Irish Nationwide Building Society could face losses. The Government was committed to paying "every last red cent" of debt owed by Ireland's two pillar banks, AIB and Bank of Ireland.

The minister was at the end of a four day visit to the US where he met potential investors in the Irish economy as well as IMF acting boss John Lipsky and US Treasury Secretary Timothy Geithner.

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