John Corrigan, the chief executive of the National Treasury Management Agency, said investors "mostly" believed that Ireland was the best positioned among Europe's periphery nations.

However, he warned the rate the State will have to pay to borrow when it returns to debt markets will be "considerably higher" than the 3 per cent charged the bailout.

Under the terms of the bailout agreement the State needs to return to the funding markets in the second quarter of 2013 at the latest, he told the PAC in Dublin today.

The State has written off about €10 billion of its investments in AIB and Bank of Ireland, according to an official of the National Treasury Management Agency.

Ireland's pension fund wrote off €8.8 billion of its stake in AIB, according to the official, speaking at a parliamentary committee in Dublin today.

The writedown in Bank of Ireland is set to total €1.1 billion.