Portugal will accept a financial bailout “within the next few weeks” as the cost of issuing debt becomes unsustainable, said Axa Investment Managers, which oversees $714 billion in assets.

“The borrowing costs are just too high” for Portugal, Christopher Iggo, London-based chief investment officer for fixed income at Axa, France’s fourth-largest fund manager, said in a telephone interview two days ago. “Ireland and Greece had to go for a bailout once their borrowing costs got that high, so I fully expect Portugal to go within the next few weeks.”

Portugal’s 10-year bond yield reached 7.64 percent on Feb. 10, the most since the inception of the euro in 1999, and was at 7.45 percent as of 9:18 a.m. in London. It first climbed above 7 percent on Nov. 10 and has been above that level since Feb. 4. Greece needed a rescue within 17 days of its 10-year yield breaching 7 percent on April 6, while Ireland lasted less than a month after it cracked that level in October.

The Iberian nation is raising taxes and implementing the deepest spending cuts in more than three decades to convince investors it can narrow its budget gap further and avoid a rescue. Standard & Poor’s said today that Portugal’s debt rating remains at risk of being cut, citing the nation’s “high external financing need and limited funding sources.”

European Union leaders have given themselves until a March 24-25 summit to craft what German Chancellor Angela Merkel has called a “comprehensive” package to address the financial crisis.

Buying Germany, France

Offering Portugal a similar aid deal to the ones given to Greece and Ireland would be “quite neat,” Iggo said, because it would allow European Union leaders to tie up any loose ends by the end of March. “The authorities wouldn’t want that sort of uncertainty to persist” beyond their summit, he said.

Axa has avoided the bonds of the euro-region’s most- indebted countries and has increased holdings of German, French, Austrian, Dutch and Finnish government securities over the last year, Iggo said.

“Spain is the interesting one,” Iggo said. “We are reasonably confident Spain will be able to pull through but we need to see what the announcement at the end of March will be like.”

Amundi Asset Management is the largest fund manager in France with 689.5 billion euros ($950 billion) under management, followed by BNP Paribas Investment Partners with 546 billion euros, Natixis Asset Management with 538 billion euros and Axa, as of the end of 2010, according to data compiled by Bloomberg.