May 9, 2019 / 12:21 PM / 7 months ago

UPDATE 3-Ireland raises 4 bln euros in bond sale

(Confirms pricing, adds quote from NTMA, and order book profile)

By Graham Fahy

DUBLIN, May 8 (Reuters) - Ireland raised 4 billion euros ($4.49 billion) from a syndicated sale of a new 2050 bond on Thursday after investors swamped the book with demand for 4.6 times that amount.

The issue was sold at a yield of 1.528 percent, with the size increased from earlier expectations of around 3 billion euros.

The National Treasury Management Agency said demand came from 325 individual accounts and overseas investors accounted for 98 percent of the take-up.

“We took advantage of favourable market conditions to ...continue our strategy of prefunding to meet future redemptions,” said NTMA Director of Funding and Debt Management Frank O’Connor

The transaction means that Ireland has raised more than 9.5 billion euros of planned 2019 debt issuance of between 14 billion euros and 18 billion euros.

The syndicated deal replaces a bond auction that had been scheduled for Thursday after Cyprus’s recent first 30-year bond sale was overloaded with orders.

The use of syndication broadens the investor base, allowing smaller euro zone countries to compete with the larger countries that can attract demand because of their benchmark status. Using banks to find demand should also help to secure more aggressive pricing and ensure liquid trading.

High demand for long maturities - with Ireland an active seller in recent years - shows how much Europe’s bond market is adjusting to expectations of persistently low interest rates and central bank stimulus.

Barclays, BNP Paribas, Cantor Fitzgerald Ireland, Danske Bank, Deutsche Bank and Goldman Sachs were joint lead managers for the transaction.

($1 = 0.8905 euros)

Reporting by Graham Fahy in Dublin and Abhinav Ramnarayan in London Editing by Larry King and John Stonestreet

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