Ireland will be ready to re-enter bond markets as planned at the end of next year but will borrow commercially again only if it wants to, a senior government minister said on Tuesday, amid talk Dublin may eventually need a second bailout from the EU and the IMF.

Despite success in cutting its budget deficit, Ireland's aim of exiting its existing 85 billion euros rescue programme in 2013 is looking increasingly difficult as the euro zone debt crisis hits its growth outlook and keeps its sovereign debt yields sky-high.

Ruairi Quinn, the government's education minister and a former finance minister, said the plan was still to return to bond markets next year but signalled such a move would happen only if Dublin thought it made financial sense.

"We intend still to be in a position to re-enter the markets at the end of 2013 should we want to do so," Quinn, who served as finance minister between 1994 and 1997, told Ireland's Newstalk radio station.

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Analysts have said if Irish borrowing costs are still around 8 percent in 2013 then Dublin would have to tap European partners for additional official funding, which currently costs Dublin over 3 percent.

Citigroup chief economist Willem Buiter said on Monday that Ireland would need to restructure part of the country's bank bailout bill or else it may have to follow Greece in making investors take losses on its sovereign debt.

The comments from Buiter, a former member of the Monetary Policy Committee of the Bank of England, prompted debate about a second bailout on Irish airwaves.

In Brussels, where officials like to hold Ireland up as a model for other indebted countries, a spokesman for EU Economic and Monetary Affairs Commissioner Olli Rehn said such talk was unhelpful.

"It is not particularly helpful at this point in time to fuel speculation about a second programme when the first one is delivering, is being implemented," Amadeu Altafaj said.

Ireland's official creditors from the ECB, the EU and the IMF started their latest quarterly review of Ireland's progress under its bailout on Tuesday.

The IMF warned last month that the prospects for a successful conclusion to Ireland's resrescueuce package remained fragile and said Europe should consider additional support for Dublin including help on the high cost of bailing out Irish banks.

Ireland's government is trying to persuade its European partners to refinance the 47 billion euros cost of shoring up Anglo Irish Bank, recently renamed Irish Bank Resolution Corp, through cheaper loans from the euro zone's rescue fund.

Some analysts have said the EU and the IMF should also relax Irish banks' deleveraging targets to help revive the flow of credit and breath life into a domestic economy still reeling from the worst recession in the industrialised world.

"Ireland needs assistance if it is to meaningfully reduce debt levels, especially that resulting from the banking crisis," Dermot O'Leary, chief economist at Goodbody Stockbrokers, wrote in a note.

"Austerity on its own will not work, but will have to be supplemented with growth-enhancing efforts, particularly in relation to the deleveraging of the banking system."

(Reporting by Padraic Halpin and Carmel Crimmins; additional reporting by Charlie Dunmore in Brussels; editing by Stephen Nisbet)