Q: What has the Government done?

A: The Irish Bank Resolution Company (IBRC) - which used to be Anglo Irish Bank and Irish Nationwide - has been wound in a deal which the Government says could save the country €1 billion a year.

Q: How did they do that?

A: Anglo left the country with about €28 billion in debts. Promissory notes - IOUs to the senior bondholders, mainly big institutional investors, who were owed the money - have been swapped for government bonds. The Government said there is just 3% interest to be paid on the new long-term bonds, compared to the 8% on the promissory notes. They do not have to be repaid until at least 2038, whereas we would be paying €3.1 billion every year under the old repayment scheme.

Q: But it that just putting off the problem for future generations?

A: Not according to Finance Minister Michael Noonan. He said inflation would ensure that the debt would be a lot more manageable when the time came around to pay it. Comparing it to taking out a mortgage, he says that at the start of the repayment period, the amount to be paid back can be quite onerous, but as time passes by and the mortgage nears its end, it becomes much easier to pay.

Q: How much exactly will be saved with this new deal?

A: The Government says we will have to borrow €20 billion less over the next decade. They have suggested this will mean less public spending cutbacks and less tax rises. While the deal will not make much of an impact on the Budget in place for 2013, analysts expect it will ease the burden quite a bit in the Budget coming this December, for 2014. While we have not cut the country's debt levels, the cost of the debt has been reduced.

Q: Why did the deal take so long to come about?

A: Project Red - what the Government called their secret plan for the promissory note - was being plotted out for quite some time, apparently.

Q: What's the reaction to the deal?

A: The Government is very happy with the deal they achieved. But critics said the deal lets bond-holders off the hook, while younger generations in Ireland will have to pick up the tab in years to come. Analysts are expecting to see very strong positive comments from the international rating agencies and predict upside ratings potential. They also say that the deal will support Irish Government bond yields. This was evident yesterday when bond yields on the benchmark 2020 bond fell to 3.9% - their lowest level since 2007.

Read the National Treasury Management Agency's briefing note on the IBRC Promissory Note transaction.