Nick Crafts provides his account here.
Category: Uncategorized
The Q1 2013 Funding of the Exchequer Balance note published by the NTMA on Friday contains the following:
31/03/13 Balances of €33,049m (31/12/12: €23,997m) were held in Departmental Funds & Other Accounts, including the Exchequer A/C.
These balances are now equal to 20% of GDP. Of the total, €3.9 billion is accounted for by notes from the Housing Finance Agency which still leaves €29 billion in the Exchequer and Other Accounts (though presumably the HFA notes could be sold).
The Exchequer Borrowing Requirement (EBR) for the remainder of 2013 could be around €10 billion (depending on the outcome of the IBRC liquidation) and there is bond of just over €4.5 billion maturing in a little over a week’s time. The full-year EBR for 2014 is projected to be around €8 billion with a €7.5 billion bond maturing in the middle of January. These total €30 billion and could be met from existing resources but it is expected that additional funding will be sought.
There is still around €10 billion of funds to be drawn from the €67.5 billion total available under the EU/IMF programme as €57.3 billion had been forwarded to Ireland by the end of March.
The NTMA has announced an intention to raise €10 billion through the issue of new government bonds in 2013. Three-quarters of this has already been achieved with €2.5 billion raised from a 2017 bond in January and €5 billion from a 2023 bond in March.
Since 2008 contributions to the national savings schemes have increased significantly. At the end of 2007, these schemes had attracted a total of €4.5 billion. In 2012, around €2.2 billion was placed with the schemes and the total had increased to €14.5 billion by the end of the year. These contributions have continued in 2013 with the NTMA Funding note showing that a further €0.6 billion was added in the first quarter.
The Treasury Bill programme was resumed last July and there is now €1.5 billion in issue across three €500 million tranches (maturing April 22, May 20 & June 24) with monthly auctions likely to continue.
Just over €1 billion was paid into the Exchequer Account in January as a result of the sale of BOI contingent capital notes. A further €1.3 billion will be received when the sale of Irish Life is completed.
This means that cash balances could be maintained at around €30 billion in December 2013 if the EU/IMF draw downs, bond/bill issues, and savings contributions set out above are made which would roughly cover twice over the €15.5 billion gross financing need for 2014. Whatever significant difficulties the economy faces, the government running out of cash in the near term is not one of them.
New ECB WP here.
The new QB provides an update on its analysis and forecasts – here.
There are two interesting signed articles:
- Measuring the Value Added of the Financial Sector in Ireland
- The Usage, Cost and Pricing of Retail Payments in Ireland
(the latter indicates a very big payoff to pushing further the move to electronic payments systems, with cheques still playing a large role in Ireland)
and also a new Economic Letter:
this is a major IMF policy paper – here.