Ireland will access its last round of low-cost EU funding under the bailout in the coming days, after the European Union yesterday issued a 10-year bond to finance the outstanding tranche of the Irish bailout.

It comes a week after the country resumed regular market access by raising €1 billion in an auction of 10-year bonds last Wednesday, the first regular sale of Government debt since exiting the bailout in December.

The EU issued a €2.6 billion 10-year bond yesterday to finance the remaining €0.8 billion due to Ireland and €1.8 billion due to Portugal as part of its penultimate tranche of bailout funding.

While Ireland officially exited its three-year rescue programme in December, the final disbursement from the European Financial Stabilisation Mechanism (EFSM) remained outstanding. The European Financial Stability Facility contribution to the Irish bailout is administered by the European Commission. It is an EU-wide fund.

The International Monetary Fund and EFSM, which is administered by the European Stability Mechanism (ESM) in Luxembourg, have already completed their disbursements to Ireland as part of the bailout.

“Funding costs will be passed on to the beneficiary countries without any margin,” the European Commission noted, as it announced the issuance of the bond yesterday.

German and Austrian investors were the biggest purchasers of the issuance, buying 45 per cent of the allocation. The bond which yields 1.919 per cent, pays a coupon of 1.875 per cent, the lowest coupon achieved by the EU, it said.

The issuance will also be used to fund the penultimate disbursement of the Portuguese bailout. Portugal is due to become the second country to exit an EU-IMF bailout, when its €78 billion rescue programme expires in two months.

Falling bond yields and the general market stability has increased the possibility that Portugal may follow Ireland’s path and exit the bailout without a precautionary credit line.

Yesterday Lisbon bought back €50 million worth of a 2015 bond. This was less than had been expected and a sign that investors were happy to retain Portuguese bonds.

The country’s 10-year yields fell by 10 basis points to 4.47 per cent, close to the four-year lows reached last week, despite the rejection on Monday by Portugal’s opposition party of the government’s long-term plan to reduce the budget deficit.

Yesterday, Greece struck a deal with its international lenders over its bailout terms, unlocking the next tranche of funding which had been due since September.