| NTMA kicks off 2004 €4 bn debt programme (down €2.5b on 2003) |
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| The first Irish Government bond of 2004 was launched on January 20th, with the NTMA expected to issue some €4 billion of bonds this year. |
The NTMA issued its latest (2020) benchmark bond on January 20th. Maturing on April 18 2020, the new bond has a coupon of 4.5 per cent, and a yielf of around 4.1 per cent, and was launched by means of a buyback and exchange programme, in which investors in the current 5% Treasury Bond 2013 were offered terms for switching up to €2 billion of their holdings in to the new issue. The buyback leg of the transaction was conducted by means of a competitive reverse price auction using the Bloomberg auction system and the proceeds were simultaneously switched into the new 2020 bond on a cash for cash basis (accrued interest on the 2013 bond is allowed to be invested).
Participation in the buyback and exchange programme was limited to the seven recognised Irish primary dealers - ABN AMRO, Dublin and London, AIB Capital Markets, Dublin, Barclays Capital, Credit Agricole Indosuez, Paris, Citigroup Global Markets Limited, Davy Stockbrokers, Dublin, and Deutsche Bank, Frankfurt.
In addition to this exchange programme, Ireland will issue some €4 billion of bonds in 2004.
This is some €2.5 billion less than in 2003, and according to the NTMA, reflects the absence of any significant debt maturities and the continued healthy state of the public finances.
It is expected that bond issuance will be mainly in the new 2020 benchmark bond and also in the benchmark 3.25% Treasury Bond 2009. The 5% Treasury Bond 2013, which will still have some €6 billion in issue after the exchange programme in January, will continue to have benchmark status, as will the 4.6% Treasury Bond 2016, and the 4.25% Treasury Bond 2007. |
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| Article appeared in the January 2004 issue.
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