Monday 26 September 2016

'Ireland' listed among top lenders to US government

Anchalee Worrachate and Wes Goodman

Published 18/05/2016 | 02:30

Ireland, owed $264bn, is just behind the Cayman Islands, which is owed $265bn
Ireland, owed $264bn, is just behind the Cayman Islands, which is owed $265bn

Ireland has emerged as America's fourth-largest creditor behind China, Japan and the Cayman Islands after the US government revised the way it reports the figures.

  • Go To

Funds registered here, mainly it's thought in the International Financial Services Centre (IFSC), were owed $264.3bn (€233.14bn) in so-called Treasuries, US government bonds, at the end of March.

That figure is down slightly since December.

China is the biggest holder of the US bonds with a $1.24 trillion stake.

Japan is next with $1.14 trillion, followed by the Cayman Islands with $265bn and then Ireland.

Ireland's total holding is bigger than the size of the economy.

But that is explained by the large number of fund managers and other companies based here.

"It's all just foreign banks, funds and corporates based here," said Owen Callan, a fixed-income analyst at Cantor Fitzgerald in Dublin. "It's probably linked to offshore mutual funds administered here or offshore-retained earnings of US multinationals."

More than 700 US companies are domiciled in Ireland, employing 140,000 people, according to the American Chamber of Commerce. And of the $1.62 trillion held by global funds administered in the nation, $337bn is in government bonds including Treasuries, data from Bank of Ireland shows.

The US Treasury Department released details of the bond holdings among the countries in OPEC and the Caribbean, dropping its practice of grouping them together, in response to a Freedom-of-Information Act request submitted by Bloomberg News.

Analysts track overseas demand for Treasuries because investors from outside the US own 47pc of the $13.4 trillion debt market, the biggest in the world. (Bloomberg)

Irish Independent

Read More

Promoted articles

Editors Choice

Also in Business