Saturday 24 February 2018

NTMA to brief investors on its plans for return to bond market

John Mulligan

John Mulligan

Move on track despite eurozone difficulties

Investors will be briefed in Frankfurt on Thursday by the National Treasury Management Agency (NTMA) about its plans to return to the bond market during the summer.

The NTMA confirmed over the weekend that its intention to issue bonds within the next few weeks remained on track despite continuing difficulties in the eurozone.

The Irish Independent has learned that Danske Bank has invited investors to a presentation at the swish Steigenberger Frankfurter Hof hotel in Germany's financial heartland.

The Danish institution's markets division is the primary dealer in Irish government securities.

Oliver Whelan, the NTMA's director of funding and debt management, as well as the NTMA's chief economist, Rossa White, will be making the presentations to investors.

"Ireland plans to return to the market in 2012 by re-launching treasury bill auctions over the summer months," the invitation tells potential investors.

"Full market re-entry is targeted for late 2012 or early 2013 by way of launching longer term bond issues."

The presentation -- one of a number that will have been held with investors -- also comes just weeks after the electorate passed the fiscal treaty by a comfortable majority.

Targets

The NTMA will outline how the country has been adhering to its bailout targets and how the economy has been performing. Ireland's tax revenue was 2.8pc above target in the first five months of the year.

But the economy faces massive hurdles and two further brutal budgets are coming down the track. They could stifle any efforts being made to encourage people to start spending again.

While the NTMA will test the water this year, it still remains uncertain precisely when longer-term bonds could eventually be sold again by Ireland.

The yield on Irish 10-year debt stands at 6.81pc. The yield on Portugal's 10-year bonds dipped below 10pc last week for the first time in more than a year. The yield on Spain's 10-year bonds topped 7pc less than two weeks ago -- the level deemed by markets to be unsustainable.

However, the rate on Spain's bonds subsequently fell to 6.38pc after French President Francois Hollande said European leaders were mulling steps that could see the European Stability Mechanism being used to buy debt from countries that have taken steps to address their fiscal positions.

Spain is due to make a formal request by today to the European Commission for up to €100bn in bailout funds for its banks.

Taoiseach Enda Kenny has reportedly told European leaders that Ireland needs a "just" solution to its banking debt or the country might not be able to re-enter the debt markets next year as planned.

Irish Independent

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