Britain's Chancellor of the Exchequer, George Osborne published legislation seeking the approval for the UK's bilateral €3.87billion loan ($5 billion) to Ireland, from the House of Commons yesterday.

Latest reports suggest that the legislation will cap the loan initially and introduce further measures to allow further increases visa a parliamentary vote.

Osborne described the loan as a special case and he has “given the strongest possible hint” that Britain is not in a position to make loans to other EU members.

The interest on the loan is yet to be negotiated but the Chancellor indicated it will be in line with rate set by the EU and IMF. The loan will be subject to review every six months.

Speaking about the loan, Osborne said that Ireland was paying the price for failing to regulate its banks properly.