Irish bank deal has grabbed investor attention-debt chief

DUBLIN Thu Feb 14, 2013 3:03am EST

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DUBLIN (Reuters) - Some 180 investors dialled into one of Ireland's largest ever debt conference calls last week, a surge in interest that will soon help it get off emergency EU and IMF support soon, the head of its debt agency said.

Dublin struck a long-awaited deal before the call to switch a costly promissory note, used to pay for the rescue of failed Anglo Irish Bank, into less expensive sovereign bonds, slicing 20 billion euros off its funding needs for the next decade.

As part of the debt swap Ireland will issue new bonds worth 25 billion euros with maturities of between 25 and 40 years. These will be slowly drip-fed into the market by the country's central bank, with a minimum of 500 million euros to be sold by the end of 2014.

"That (the deal on the note) has really grabbed attention," John Corrigan told the Irish Independent in an interview that was his first public comment since the deal was sealed with the European Central Bank.

"They seemed fairly happy with what came out. The main area of concern is how long the Central Bank will hold the new bonds before selling them on to the market."

"The fact that there is a minimum laid down gives clarity and we were able to say that the Bank would only sell more if financial stability allowed it."

The deal adds to the positive momentum the National Treasury Management Agency (NTMA) has built up over the last year, helping it raise a quarter of its 10 billion euro target for the year through the sale of five-year debt last month.

That target remains in place despite the reduced funding pressures, a spokesman for the NTMA said.

Corrigan said last month that the agency's next step would be to issue a new 10-year benchmark bond ahead of a return to regular long-term debt auctions that he reiterated on Thursday would signal a full market return as the bailout exit loomed.

"The door is open," Corrigan said. "We're nearly there, but they don't ring a bell to say that the bailout is over and austerity at an end. The world is an uncertain place."

(Reporting by Padraic Halpin; editing by Patrick Graham)

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