* First euro zone state to complete bailout
* Not the end of the road, finance minister says
* Will consider income tax cuts
* Economy looking healthier but challenges remain
By Conor Humphries and Sam Cage
DUBLIN, Dec 13 (Reuters) - Three years after going cap in hand to international lenders to avert bankruptcy, Ireland has officially ended its bailout in a landmark for the euro zone's efforts to resolve its debt crisis.
Ireland has cut spending and raised taxes to rebalance the economy since seeking emergency help from the European Union and International Monetary Fund, meeting every major target under the 85 billion euro ($117 billion) programme and enduring little public unrest.
"This isn't the end of the road. This is a very significant milestone on the road," Finance Minister Michael Noonan told a news conference on Friday.
"But we must continue with the same types of policies."
The country of 4.6 million is funded into 2015 thanks to debt issuance over the last 18 months. It is showing the way to Greece, Portugal and Cyprus - which have also had sovereign bailouts - and Spain, which has had help for its banking system.
With more than 22 billion euros ($30 billion) of cash in hand, almost twice the amount initially envisaged by its lenders, Ireland has insulation against market shocks and the economy is forecast to grow by about 2 percent next year.
Unemployment has fallen below 13 percent, from a 15.1 percent peak in 2012, and Dublin is confident enough to do without a backup credit line.
In a sign of European admiration for Ireland's efforts, Noonan received an award from the German-Irish chamber of commerce for his role in the bailout exit and "huge positive impact" on relations between the countries.
But there is a sharp divide between capital and countryside and smaller towns. Jobs are being created and house prices rising in the former, while the latter are still strewn with empty properties from the "Celtic Tiger" boom years and closed down shops. Economic recovery is also heavily reliant on exports.
While pledging to maintain fiscal discipline, Noonan said he will consider income tax cuts in the next two budgets to give the economy some support.
Ireland could cut its total debt load from a peak of 124 percent of gross domestic product this year to 116 in 2014 by using its cash buffers, Noonan said.
"They have to be prudent. You can't just cut taxes for the sake of it," said Alan McQuaid, chief economist at Merrion Stockbrokers. "It's a good story for the EU and it's a good story for us (but) we're still at the mercy of global factors."
Leaving the bailout is an important achievement but Prime Minister Enda Kenny's government still has plenty of hurdles to overcome as it seeks to win over the Irish people, with an election due by early 2016.
Kenny, who inherited the bailout when he came to power in 2011, will start efforts to win back voters in a state of the nation address on Sunday evening, the date he has earmarked as the official end of the bailout.
Ireland's costs to borrow money for 10 years have now fallen below 3.5 percent, from a high of 15 percent just eight months into the bailout, but many people, particularly outside the capital, have yet to feel better about their finances.
"They say it'll turn around, but by the time it turns around people will be devastated, broke," said Michael Moore, a pensioner in Dublin. "They just don't seem to give two damns."
Another concern are the banks, which drove the country to seek help and are now taking centre stage again. A central bank assessment of balance sheets showed capital adequacy ratios at Bank of Ireland, the only lender not fully owned by the state, dropped more than expected.
"The phase of additional European countries going into programmes, and those in programmes being uncertain about their future, that has passed now and the euro zone is quite strong again," Noonan said.
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