Investor orders hit €11.3bn in State’s first green bond sale

Irish brokers left out of the deal as foreign banks share €6m commission on €3bn bonds

The transaction brings the NTMA’s long-term fundraising so far this year to €16.5 billion. Photograph: iStock

The transaction brings the NTMA’s long-term fundraising so far this year to €16.5 billion. Photograph: iStock

 

The National Treasury Management Agency (NTMA) received about €11.3 billion of orders from investors seeking to buy the Republic’s set of green bonds.

The €3 billion of 12-year bonds on offer were priced on Wednesday to carry a market interest rate, or yield, of 1.399 per cent.

The funds will be used to finance eligible projects such as sustainable water and waste management, clean transportation and renewable energy deals, as the National Development Plan targets €23 billion of spending on green energy schemes over the next decade.

The Irish brokers are a very important element of our market

The transaction brings the NTMA’s long-term fundraising so far this year to €16.5 billion, compared to its stated target of between €14 billion and €18 billion.

Overseas banks Barclays, BNP Paribas, Citigroup, Danske Bank, HSBC and JP Morgan shared an estimated €6 million in fees from the deal, as Irish brokerages were overlooked for the first time in decades on an Irish government bond sale.

‘Deeper penetration’

Frank O’Connor, director of funding and debt management at the NTMA, said the agency “felt on this occasion we’d get a deeper penetration” in the growing green bonds market by only using foreign banks on the first deal.

“The Irish brokers are a very important element of our market,” he said, adding that “hopefully” local firms will be given a slice of the action on future green bond issuance.

Mr O’Connor said the NTMA may sell a further €1 billion through a green bond auction next year.