Minister for Finance Michael Noonan has said he does not expect any immediate breakthrough in the Government's efforts to reduce the State's burden on the €31 billion promissory note.
The funding mechanism was brokered as a means of meeting the losses from the former Anglo Irish Bank and Irish Nationwide.
Mr Noonan ruled out any major momentum on the issue at the EU summit next week but added the conditions were right for the Government to focus its efforts on reducing its debt burden in the autumn.
The promissory note left the State on the hook for the liabilities from the two failed financial institutions.
Mr Noonan said with the Greek and French elections over, and with the first steps taken to deal with the Spanish situation, it would allow him to have conversations with his EU counterparts at a meeting of finance ministers in Luxembourg later this week.
"I have always said, for a year now, that it's a medium-term exercise. I don't expect any final situation to evolve before the summer recess but we will be pushing very hard in the autumn," he said.
The Minister said the Government was not under any time pressure on this matter. "The promissory note was a March issue, when a Government payment of a little over €3 billion fell due.
"Since then the arrangements have dropped out of headlines."
When the Bank of Ireland transaction, to allow the Government pay a €3.1 billion promissory note for the former Anglo Irish Bank with a bond instead of cash, came up for discussion yesterday it was hardly mentioned, Mr Noonan said, although it was the "hottest story around last March".
The promissory note for both stricken financial institutions was issued in 2010, some time before the State entered the EU-IMF programme.
Consequently, the State was levied very high interest rates. Some estimates put the final bill to the State at €47 billion or higher.
Asked about reports that the Troika was discussing the possibility of extending the maturity date of the State's borrowings from the European Financial Stability Fund to up 30 years, Mr Noonan seemed to downplay the possibility, saying he assumed it was speculation.
"We have no official notice of what was reported. We assume it was further speculation. We have no official notification [and] no firm basis for it," he said.
Mr Noonan was speaking to reporters at a doorstep interview where it was announced the Californian-headquartered Silicon Valley Bank has plans to invest as much as $100 million into Irish innovation.
Speaking later at the Oireachtas Committee on Finance Mr Nooan said any European bank resolution fund "would have to apply retrospectively" for Ireland to support it.
There was no point in Ireland supporting and paying into a fund "to resolve colleagues' banks" if it can't tap such a fund to refinance part of the country's bank bailout debt.
While different EU member states had different views on what a European banking union would involve, Ireland believed that it would need to include a deposit guarantee plan and mutualised bank resolution fund, he said.
Mr Noonan added that he was "reasonably confident" that the State would return to international debt market as planned next year.
He said the Government's plan was to test the market later this year, unless events intervene.
He said the government hasn't raised the issue of extending the term of official loans, though doing so without penalties would be helpful.
Additional reporting: Bloomberg
