Monday 14 October 2019

Plan for exit from bailout includes sale of €10bn in bonds, TDs are told

Donal O'Donovan

Donal O'Donovan

THE top official responsible for managing the national debt said he welcomed the support of US investor Franklin Templeton and was not concerned by the large stake that it now holds in Irish bonds.

The chief executive of the National Treasury Management Agency John Corrigan told the Oireachtas Public Accounts Committee that the NTMA planned to issue €10bn of long-term government bonds over the course of next year in preparation for the country's exit from the EU/IMF bailout.

He added that he was confident of attracting enough investment to avoid a second bailout.

The €10bn was likely to include a syndicated bond sale, said Mr Corrigan. Bonds sold through a syndicate of banks can reach a wider audience than debt sold at auction. More broadly, the NTMA hopes to set out – and stick to – a calendar of regular, monthly sales of long-term bonds early next year.


Such deals, explained Mr Corrigan, had helped ease fears that the country could require a second bailout at the end of 2013 by slashing almost €10bn off the amount of debt falling due in 2014. At €12bn, this had threatened to create a funding hurdle for the State.

He welcomed the attention of US investor Michael Hasenstab's Franklin Templeton Investments, which has become Ireland's biggest private sector creditor over the past year-and-a-half by investing in bonds.

Mr Corrigan said: "As an investor, Franklin Templeton are clearly very welcome in the positive view they have taken on the Irish market.

"We would prefer if we had 10 Franklin Templetons, rather than one."

He said there was little risk that the US firm would damage the price of Irish bonds by selling out of its €8bn investment.

This, he argued, would be "self-defeating", adding that the firm was likely to have considered its exit strategy before deciding to buy the Irish assets.

Mr Corrigan told TD Shane Ross that high pay in the NTMA and linked bodies – such as NAMA – reflected norms in the financial sector, where these had to compete for staff.

Irish Independent

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