Ireland will publish what is meant to be the final bill for propping up its banks on Thursday

Ireland will publish what is meant to be the final bill for propping up its banks on Thursday, in a last-ditch bid to convince investors it can avoid a damaging restructuring that would deepen Europe's debt woes.

Ireland's new government has pledged to outline a "credible" plan for sorting out its financial system on the back of fresh stress tests but its plausibility will rest on any concessions Dublin can win from its paymasters in Brussels and Washington.

A bailout from the European Union and the International Monetary Fund late last year failed to resolve the financial crisis and Dublin's dismal record in calling the end of its banking woes, now in their third year, mean scepticism is high.

"We have been at moments like this so many times in the past where we thought that this will be the decisive element," said Austin Hughes, chief economist at KBC Bank.

"Once more we cross our fingers and hope that this will be the defining moment and we will able to begin to look beyond the current difficulties.

"The crucial element is that we get a coherent response on this from goverment and Europe."

Dublin is relying on the European Central Bank (ECB) to give medium-term funding to its banks to help cap the cost of recapitalising them below the 35 billion euros set aside for the lenders in an 85 billion-euro bailout package.

An announcement on such a facility, revealed to Reuters by a euro zone central banking source last week, may come after the results of the stress tests are published at 1530 GMT in Dublin.

Even with a credible banking bill and funding from the ECB, Ireland's Prime Minister Enda Kenny still needs to persuade European partners to cut the cost of their loans to the euro zone struggler and possibly extend the loans' duration to convince investors Ireland can tackle its debt mountain.

Local media have said Bank of Ireland (BKIR.I), Allied Irish Banks (ALBK.I), Irish Life & Permanent (IPM.I) and EBS Building Society [EBSBS.UL] will need between 18 billion and 23 billion euros in additional capital after the tests.

Six analysts surveyed by Reuters have put a figure of 23 billion euros on the bill.