The European Commission has approved the extension of the Credit Institutions (Eligible Liabilities Scheme) for short-term liabilities, including corporate and interbank deposits and debt securities until the end of December.

The European Commission stated that the scheme for short-term liabilities contained sufficient safeguards to ease competition concerns which include higher premiums to be paid by the banks for the guarantees and adequate measures to minimise potential distortions of competition.

The European Commission further stated 'the Commission therefore concluded that the scheme is an adequate means to remedy a serious disturbance in the Irish economy and is as such compatible with the special state aid rules put in place at the beginning of the global financial crisis'.

The extension to the scheme covers deposits by large companies, deposits by banks and short-term bonds. Subordinated bonds will not be covered under the scheme