cryptogon.com

Britain, not part of the eurozone, “stands ready to support Ireland” in whatever the debt-stricken country needs to do to stabilize its troubled banking system, Finance Minister George Osborne said.

“It is in Britain’s national interest that the Irish economy is successful and we have a stable banking system,” said Osborne, a day after the eurozone finance ministers failed to convince Ireland to accept a Greek-style bailout.

Irish and EU officials vowed Tuesday night to stabilize the banks at the center of Ireland’s financial crisis and keep it from spreading to other fragile euro-linked economies. Representatives of the EU, the European Central Bank and the International Monetary Fund will travel to Ireland this week to determine what to do about the banks.

Ireland has taken over three banks and is expected to take over more in a bailout that has already reached euro45 billion ($61 billion) and likely will push the nation’s 2010 deficit to a staggering 32 percent of GDP. The government in Dublin insists that it doesn’t need a bailout from Europe, but growing doubts about Ireland’s ability to pay its bills have sent interest rates soaring on Irish bonds.

“It is natural (that the U.K. would be interested in helping to stabilize Ireland), because the United Kingdom and U.K. banks have a very, very significant exposure in Ireland,” said the EU’s monetary affairs chief Olli Rehn. “There is a very strong interconnection in the banking sector and the financial system between the two countries.”