Irish Eyes Smiling at Successful Sovereign Debt Issue
THE Irish Government has heralded big demand from hundreds of international investors who lined up to lend to the country in its first auction of sovereign debt since the end of the bailout.
Some [euro]3.75bn in IOUs known as bonds was offered on the global money markets with orders worth [euro]14bn (PS11.6bn) coming in, the National Treasury Management Agency (NTMA) said.
Michael Noonan, Finance Minister, said the bidding war showed the strength of Ireland's international reputation.
"The level of demand for today's sale with some [euro]14bn of orders shows that the Government's decision to exit the EU-IMF programme without a precautionary credit line has built strong confi-dence amongst investors," he said.
"It is particularly noteworthy that the orders of [euro]14bn for today's sale exceed the [euro]10bn (PS8.2 billion) that could have been available under a precautionary programme."
The 10-year bonds - effectively IOUs from the state which accrue interest over their lifetime - mature in March 2024.
They were sold with a yield or interest rate of 3.54% - closer to the borrowing rates of stronger European economies like the UK and Norway and also the US. …