The International Monetary Fund (IMF) is releasing further 3 billion euros (4.0 billion U.S. dollars) in loans to Ireland following a review of the bailout program.

The latest release of funds follows the IMF's fifth review of Ireland's performance and brings loans up to more than 16 billion euros over three years.

The IMF said the Irish authorities continued to advance wide ranging reforms to restore the health of the financial system so it can support Ireland's recovery.

It added that Ireland achieved its aim of lowering the budget deficit last year and it did so at a faster rate than planned.

It said Ireland was on track to bring the deficit down this year to the targeted level of 8.6 percent of national output.

The IMF also mentioned the Irish government's recent announcement of the sale of 3 billion euros in state assets, with one third of the proceeds intended for reinvestment in the Irish economy.

IMF First Deputy Managing Director David Lipton said in a statement that the challenges Ireland faces have intensified since the outset of the bailout program, with growth expected to ease to about 0.5 percent in 2012, owing to a slowdown in trading partner activity.

"The Irish authorities have responded by raising the fiscal consolidation effort adopted in Budget 2012, and the budget remains on track to meet an unchanged general government deficit target of 8.6 percent of GDP," he said.

"If growth should weaken further, the automatic stabilizers should be allowed to operate to help avoid jeopardizing the fragile recovery," he said.

Lipton said financial sector reforms must continue to rebuild long-term viability of the banks and improve the quality of their balance sheets "to support a renewal of sound lending and domestic demand recovery."

"Continued strong implementation of fiscal consolidation, and financial and structural reforms by the Irish authorities will be critical for the government to regain timely and substantial access to market funding," he added. (1 euro = 1.3 U.S. dollars)