NTMA stops repo facility for bonds with less than 1½ years to maturity

The National Treasury Management Agency (NTMA) has stopped providing repurchase facilities for bonds with less than 18 months to maturity, it said today.

The debt management agency had been offering additional liquidity facilities for bonds with shorter maturities when markets became volatile last year but the agency’s deputy head of funding said it was withdrawing such facilities.

“When any bond comes up to 18-month maturity we won’t provide repo facilities for it,” Anthony Linehan said. “We did last year for a bit when the markets were hit by turmoil but we have gone back to the normal route; this would have always been the way before.”

The agency e-mailed Irish primary dealers on August 24th telling them it was scrapping repo facilities for securities with less than 18 months to maturity. It also said it was stopping repo facilities for a 3.9 per cent bond due in March.

Ireland’s two-year borrowing costs are about 9.6 per cent down from a high of 24 per cent hit in mid-July. – (Reuters)