The National Treasury Management Agency plans to hold bond auctions in February and March as part of its plan to raise between €12 billion and €15 billion this year to help fund the exchequer and make early repayments of loans owed to the International Monetary Fund.
The NTMA will hold auctions on February 12th and March 12th, subject to market conditions.
In addition, Treasury Bill auctions, which involve short-term funding, will take place on January 29th and March 19th assuming market conditions allow.
These auctions follow on from the NTMA’s success last week in raising €4 billion via a syndicated seven-year bond with a record low yield of 0.867 per cent.
On a conference call with media Monday, Frank O’Connor, the NTMA’s director of funding and debt management, said this represented a “strong start” to the year for the NTMA.
The €4 billion raised last week added to the just over €11 billion in cash held by the NTMA on behalf of the State at the end of 2014.
Mr O’Connor said there would be a net outflow of some €6.6 billion in the first four months of this year, comprising an exchequer borrowing requirement (EBR) of €4.4 billion (the total for the whole year will be €6.5 billion) and €2.2 billion required to redeem a bond that matures in February.
“We’ll have ebb and flow through the EBR numbers [as the year progresses],” he said.
In addition, the agency plans to repay early an additional €9 billion to the IMF, having paid that sum to the Washington DC body last year. Ireland borrowed €22.5 billion from the IMF in 2010.
Mr O’Connor said the indications are that the State will achieve the €1.5 billion saving over the lifetime of the IMF loan that was flagged by the Government last year when a deal was brokered with the EU-IMF troika.
He said the NTMA was targeting cash balances of “in or around €10 billion” for the end of this year.
Mr O’Connor declined to comment on how long more Ireland might continue to benefit from the record low yields it has achieved for its bond issuances in recent times.
In addition, he said he has had “no indication” from ratings agency Moody’s as to the outcome e of its latest review of Ireland, which is due to be published on Friday. Moody’s raised its rating on Ireland by three notches in 2014.
