Britain paid the first instalment of its £3.25 billion bailout loan to Ireland, treasury minister Mark Hoban said yesterday.

The government disbursed £403.3 million last Friday, Mr Hoban said in a statement to parliament in London.

The loan matures in 2019 and carries an interest rate of 4.667 per cent.

Last year, Ireland became the second euro-region country to need a rescue as the cost of saving its banks threatened a rerun of the Greek debt crisis. The British commitment to aid Ireland with a direct loan comes at a time when Britain is undergoing deep spending cuts. – (Bloomberg)