* Sinn Fein wary deal could impact two decades of peace
* Adams says would support additional funds for province
* N.Irish parties seeking to restore regional government (Adds details, more quotes)
LONDON, June 15 (Reuters) - Northern Ireland’s largest nationalist party would oppose any deal their main unionist rival strikes to prop up British Prime Minister Theresa May that undermines peace in the province but would welcome the increased funding it may bring.
May has been holding talks with the Democratic Unionist Party (DUP), keen to get the backing of their 10 lawmakers in Westminster’s parliament to return to government after failing to win a majority in last week’s British election.
The prime minister met leaders of Northern Ireland’s other political parties on Thursday, some of whom had voiced concerns that a tie-up could destabilise local politics and undermine the British government’s neutrality in overseeing separate talks to form a new power-sharing government in Northern Ireland.
“We will oppose any deal which undermines the Good Friday agreement,” Sinn Fein president, Gerry Adams, told reporters outside May’s Downing Street residence, in reference to the 1998 peace deal that ended three decades of sectarian violence.
“A little side bargain to keep Theresa May in power, a temporary little arrangement won’t have any integrity and certainly is not as important as the integrity and the needs of the people who live in Ireland.”
The DUP’s main demands centre around securing more funding for the province, a source close to the party told Reuters on Saturday and Adams said he would welcome such funds.
“We are consistently making the case that our institutions are under resourced, have been undermined by austerity and need to be properly funded. So of course we would support any monies going to the executive,” Adams said.
Sinn Fein, which won seven seats in the British parliament last week but does not take up its seats or vote in Westminster, would likely reject a deal to form a government by refusing to work with the DUP in Northern Ireland.
However some analysts say a deal between May and the DUP that hands the province additional resources but does not damage Irish nationalist interests or undermine peace could motivate Sinn Fein to agree to form a new power-sharing government.
The DUP represents people in Northern Ireland who wish the province to remain part of the United Kingdom, while Sinn Fein wants Northern Ireland to be administered by the Irish Republic.
Others leaders who met May remained sceptical.
“The prime minister will have to do a lot more to convince us that the DUP tail isn’t wagging the Tory dog,” Colum Eastwood, leader of the nationalist Social Democratic and Labour Party (SDLP), said in a statement. (Reporting by David Milliken and Kate Holton; Writing by Padraic Halpin in Dublin; Editing by Elizabeth Piper and Alison Williams)