DUBLIN Oct 4 Ireland's main funding focus for
next year will be resuming a modest auction programme, a move
that would confirm beyond doubt that it has regained full market
access, the head of the country's debt agency said on Friday.
Ireland, which is set to become the first euro zone country
to exit an international bailout later this year, said earlier
this week that it would not issue any more bonds before year-end
as it has enough cash on hand to fund itself for 2014.
The National Treasury Management Agency (NTMA) had planned
to tap markets in the final quarter to fully demonstrate the
"regular market access" that the European Central Bank says is
necessary for its bond-buying programme.
But having sold debt periodically over the last 18 months,
including 5 billion euros of new 10-year bonds in March, the
agency will use next year to pre-fund for 2015, when it needs to
raise less than 10 billion euros.
"We could do a syndicated issue or a tap but the main thing
is to get back to the market with a modest auction programme,"
the NTMA's John Corrigan told reporters.
"Given the low level of funding that we have next year,
reconciling having a regular bond auction with new products is a
difficult challenge and if they are not reconcilable, we would
have to go with the regular bond auction."
Ireland aims to secure a precautionary credit line from the
euro zone's bailout fund later this year to smooth its exit from
the EU/IMF rescue package it took in 2010. That would help
maintain its eligibility for the ECB's yet-to-be-used Outright
Monetary Transactions (OMT) programme.
Dublin must also show it has "regular market access" to be
eligible for the ECB's bond-buying, although Frankfurt has yet
to clearly define what that means.
With cash balances of around 25 billion euros, Corrigan said
the question of triggering OMT does not arise and added that
while a precautionary credit line would be "a nice club to have
in the golf bag", he does not expect it to be drawn down either.
"People's definitions of full market access differ. Any
doubts that there might be about our capacity in that respect
would be entirely put beyond discussion when we resume a normal
auction programme," he said.
"My understanding is that if you are in a programme you are
eligible for OMT but given the level of cash balances, the
question of triggering that doesn't arise and we wouldn't want
it to arise."