On September 15th, the National Treasury Management Association (NTMA) held its first bond auction since June 2004. The auction, which was confined to the NTMA’s nine recognised primary dealers, was for €600 million of the 4.5p.c. Treasury Bond 2020, the NTMA’s bond with the longest maturity.
The NTMA has a modest funding requirement for the year 2005, of around €4.3 billion. It has maturing debt of some €1.6 billion which needs to be refinanced and an Exchequer Borrowing Requirement of not more than €2.7 billion.
It already raised €384 million this year, from its very successful $500 million bond issue in February. This funding, together with borrowings from other sources and changes in the level of Exchequer cash balances, leaves a requirement to raise some €3 billion in additional funding through bond and short term paper issuance this year. As such, the NTMA expects to hold further bond auctions in October and November of this year.
Meanwhile, the Irish Stock Exchange has launched a new suite of indices, the ISEQ-BIS, which will allow investors to track the progress of the Irish Government Bond market.
There will be six indices. The ISEQ All Bond Index will cover bonds of all maturities while there will be additional sub-indices covering bonds with maturities of under three years; under five years; under ten years; over five years and over ten years. The indices, which have been backdated to March 2003, will be calculated each Exchange business day at 16:30 and will provide instant detail on how the bond market has performed across the full range of maturities.
Currently, there are 15 different Irish Government bonds listed on the Irish Stock Exchange with maturities ranging from 2005 to 2020. The current capitalisation of the bond market is approximately €34 billion and in the most recent half-year period to the end of June 2005 the average daily turnover on the bond market was €204 million. |
