Only a few weeks ago, companies and government agencies diverted cash away from Irish banks, opting instead to avail of overnight facilities in the Central Bank. Rumours circulated that as much as €60bn had been shifted out of the Irish banking system since Christmas. Ireland's benchmark 10-year paper changed hands on the debt markets at over 6%, a hugely more expensive rate than even debt-laden Italy.

Investors and speculators were betting on the expulsion of Ireland and Greece from the eurozone. The cost of insuring Irish sovereign debt soared to a record in late February of almost 3.8%.

Eight weeks later, you can almost touch the relief down at the National Treasury Management Agency (NTMA). As it hosted a press conference last week for Minister for Finance Brian Lenihan and bad bank guru Peter Bacon, officials appeared to believe the worst stresses of the debt markets have passed.

Fears of some commentators that Ireland would be blocked from raising money on the debt markets appear to have receded too. Confidence appears to be growing that Ireland will sell its 10-year debt paper in future months at much lower rates than the 5.8% it had to pay last month.

However, it appears Ireland is facing into a long period of paying substantially more for its ever-growing debt pile. After the unveiling of the bad bank plan and the emergency budget, the best international debt experts expect is that the Irish premium will narrow to about 1% more paid by Germany. That's about the annual interest Italy has to pay for a debt pile that stands at about 110% of its GDP.

For it appears that no matter how it is classified, analysts overseas will count the assets in the Irish bad bank company, the National Asset Management Agency, as liabilities that belong to Ireland Inc.

Eamon Quinn