LONDON (MNI) – Ireland is making progress towards achieving a
smooth exit from the EU/IMF aid programme, NTMA Chief Executive John
Corrigan.
“Ireland is successfully accessing market-based funding in parallel
with the EU/IMF funding programme,” Corrigan told the Public Accounts
Committee of the Dail. “This is critical to completing a successful
transition to full market-based funding when the EU/IMF programme comes
to its scheduled end at the end of 2013.”
“We have made very considerable progress in our re-engagement with
the markets over the past year,” he added.
“During 2012, our engagements with the debt markets have included
bond switches; the issuing of conventional bonds; the issuing of a
completely new debt instrument, Irish Amortising Bonds, tailored to meet
the needs of the domestic pensions industry; and a return to the
short-term debt markets through the regular holding of three-month
Treasury Bill auctions,” Corrigan said.
Corrigan also said Ireland had been successful in addressing the
so-called “funding cliff” presented by a scheduled bond repayment of
E11.9 billion due in January 2014, which has been effectively reduced by
E9.5 billion to E2.4 billion through a series of long-term capital
markets operations during 2012.
“This has been viewed very positively within the investment
community and has given many investors greater confidence to lend money
to us. Addressing the funding cliff and demonstrating that we can raise
funds in the market have been key factors in the continuing fall in
Irish bond yields”, Corrigan said.
Corrigan noted that the improving market sentiment towards Ireland
illustrated by favourable patterns in Treasury Bill auctions “The yield
on the T-Bill sold in July was 1.8%, with demand for this bill running
at 2.8 times the amount offered for sale, but the yield on the T-Bill
sold this month fell to 0.55%, with demand running at 4.1 times the
amount on offer.”
However, the Irish debt chief said sustainable re-entry to the
markets remained dependent on several factors. “Some are within our
control, such as the country continuing to meet its commitments to the
Troika. Others, particularly those affecting the wider Eurozone, are
not.”
“The NTMA will continue to engage with investors at home and
abroad, presenting the case for investing in Irish Government debt in an
open and upfront manner,” Corrigan pledged.
“The National Pensions Reserve Fund has taken a lead role in the
development and implementation of a number of investment initiatives in
Ireland, including the Irish Infrastructure Fund, Innovation Fund
Ireland and an innovative agreement with Silicon Valley Bank to
introduce new funding to Irish technology companies,” Corrigan said.
–London newsroom: 00 44 20 7862 7494; email: nshamim@marketnews.com
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