Banks get welcome deposits from NTMA
Cantillon: agency is thought to have up to 18 months’ worth of funding to help State pay its bills post-bailout
Permanent TSB’s interim results showed an increase of €2.5 billion in its deposits in the first six months of this year. Photograph: Bryan O’Brien
Permanent TSB’s interim results on Thursday showed a healthy increase of €2.5 billion in its deposits in the first six months of this year. The report on the results stated that this included a €1.9 billion deposit by a Government institution.
This was a related-party disclosure given that Permo is more than 99 per cent owned by the State. The institution in question was the National Treasury Management Agency.
Similarly, Bank of Ireland’s recent interim results showed the NTMA had increased its deposits by€500 million to €1.8 billion.
Was this just routine housekeeping by the NTMA? Where did these funds come from? What interest rate is the NTMA getting from the banks?
The NTMA wouldn’t comment on the deposits or its reasons for placing them with Bank of Ireland or Permo.
The agency is clearly holding a lot of cash on behalf of the State right now to fund our exit from the EU-IMF bailout programme at the end of the year.
It is thought to have up to 18 months’ worth of funding in place to help the State pay its bills post-bailout.
This would be a mix of drawdowns from the Troika and the €5 billion in funding secured in March from the sale of a 10-year bond.
It also has responsibility for the National Pension Reserve Fund, which is currently being morphed into a strategic investment fund to help boost economic activity here. The new Irish Strategic Investment Fund has about €6.4 billion in its coffers.
Wherever the NTMA has switched the money from, AIB, Bank of Ireland and Permo, which all number the State as a shareholder, won’t complain if they get a slice of the action.
The more deposits the better from their point of view.
INM positions itself for digital growth
What’s next for Independent News & Media? Vincent Crowley, its chief executive, said yesterday it was “operationally geared” for growth, having turned in an operating profit for the first half of 2013.
The media group has almost completed the €26 million cost-saving exercise it calls “Project Resolute”, Crowley said – the biggest savings being the €14.4 million it has shaved off its payroll. Though “efficiencies are an ongoing thing, you never stop in that regard”, it has no new targets for cuts in mind right now.
So what about growth prospects? For a company that remains lumbered with €290.6 million in debt and still has to complete its financial restructuring, it might seem odd to talk about expansion. Yet this is an industry in transition, so extending its digital tendrils beyond the base line of digital publishing has to be part of its strategy.
“The whole banking deal is predicated on projections and forecasts for five years, and within that we have carved out a reasonable sum of money particularly over the next couple of years to invest in digital,” said Crowley. “That will manifest itself primarily in investing in people and investing in technology.”
It has integrated its print and online teams on the editorial and the commercial sides of the business and completed consumer research on an Independent.ie paywall. This week it made a significant appointment in the shape of Fiona O’Carroll, a former executive at Houghton Mifflin Harcourt, who is now INM managing director of digital. INM has given O’Carroll “overall responsibility for the development and implementation of INM’s business activities across its various digital platforms and channels - existing and new”.