The National Treasury Management Agency (NTMA) secured more than €36 billion of orders from international investors on Thursday for €3 billion of bonds it put up for sale as market participants digested the new programme for government.
The bonds, which are due to mature in 30 years’ time, were priced to carry an interest rate – or yield – of 3.154 per cent.
“Today’s 30-year bond transaction demonstrates continuing strong investor appetite for Irish Government bonds,” said Dave McEvoy, director of funding and debt management at the NTMA.
“Owing to the exchequer’s healthy cash and liquid asset balances, and the projected exchequer surplus, we expect to have a relatively limited borrowing requirement this year. The €3 billion raised today represents almost 40 per cent of the midpoint of our 2025 bond funding range, leaving us well positioned to meet the exchequer’s funding needs over the remainder of the year”.
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The Government last week reported a target-beating €12.8 billion exchequer surplus last year on the back of a record tax haul of €108 billion last year – driven by the transfer of almost €11 billion from Apple, after the Court of Justice of the European Union (CJEU) ruled in September that the iPhone maker owed the State billions in back taxes and interest.
All told, about €14 billion of Apple money is expected to transfer.
[ NTMA hires banks to sell €3bn of bonds as new government takes shapeOpens in new window ]
The Department of Finance has estimated that the general Government surplus – a broader measure that takes in other State agencies and bodies – reached €23.7 billion last year and will be followed up by a €9.7 billion out-turn this year.
About €14 billion of existing Government debt, including bonds and bailout-era loans from the EU, are due for redemption in both 2025 and 2026.
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The NTMA was sitting on a cash balance of €34 billion at the end of 2024, including Apple tax money. The cash position is expected to fall during 2024, the agency said in a presentation posted on its website as it marketed the new bonds.
The programme for Government, agreed on Wednesday by Fianna Fáil, Fine Gael and the Regional Independent Group, promises hundreds of thousands of new homes, cheaper childcare and a tourism push.
Alongside a pledge to deliver 300,000 new homes by the end of 2030, the programme for government promises a new national housing plan to succeed Housing for All, brought in by the last administration.
The yield on Ireland’s benchmark 10 year bonds has risen to about 2.81 per cent from 2.34 in a little over a month, in line with sovereign bonds on both sides of the Atlantic amid uncertainty over incoming US president Donal Trump’s policies even as analysts expect central banks to continue to cut official interest rates.
Major central banks, including the European Central Bank (ECB) and US Federal Reserve, started to ease rates last year as inflation eased.
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