The National Treasury Management Agency (NTMA) today reported results for 2014 and provided a review of activities across the range of its business functions.
NTMA Chief Executive Conor O’Kelly, who took up his position earlier this week, said the recent commencement of the NTMA (Amendment) Act was a welcome development. The legislation replaces the separate boards and committees that arose from several extensions to the Agency’s remit over the years with a single over-arching board structure.1
The new legislation also formally established the Ireland Strategic Investment Fund (ISIF), which absorbed the assets of the National Pensions Reserve Fund (NPRF), and placed NewERA on a statutory footing as a dedicated centre of corporate finance expertise to Government. Mr O’Kelly said it would be a priority in early 2015 to finalise an investment strategy to underpin the ISIF mandate, which is to invest on a commercial basis to support economic activity and employment in Ireland.
Turning to the NTMA’s funding and debt management programme Mr O’Kelly said: “Last year saw the NTMA, under the leadership of John Corrigan, make a full return to the bond markets with regular auctions and the issue of two new long-term benchmark bonds. Ireland’s position was further improved with the early repayment in December of €9 billion of its IMF loan facility using cheaper, long-term market funding. The NTMA plans to issue €12-15 billion of long-term bonds over the course of this year (2015) which includes provision for further IMF repayments. The €4 billion sale of a new 7-year benchmark bond yesterday represents a strong start in this regard.”
The NTMA also worked closely with the Department of Finance in 2014 on the establishment of the Strategic Banking Corporation of Ireland (SBCI). The SBCI will provide low-cost, flexible finance for Irish small and medium-sized businesses (SMEs). The NTMA assigns staff to the SBCI and provides it with business and support services and systems.
Delivering major infrastructure
2014 saw progress on several major Public Private Partnership (PPP) projects in which the National Development Finance Agency (NDFA) had a key role:
- The N17/N18 road PPP project (a 57-km stretch of motorway in Galway) reached financial close in April 2014 and construction is underway. This was the first Irish PPP to include institutional investor debt funding since the start of the financial crisis and was voted European PPP Deal of the Year at the 2014 Project Finance International awards. (NDFA was financial advisor)
- Construction of Schools PPP Bundle 3 – providing a total of 5,700 school places at eight schools in Donegal, Galway, Leitrim, Limerick, Westmeath, Waterford and Wexford – was completed on time and on budget in April 2014. (NDFA was procuring authority and financial advisor)
- Financial close on Schools PPP Bundle 4 – providing 3,000 pupil places at 4 schools in Clare, Cork, Louth and Tipperary – was achieved on 22 December 2014 with construction commencing this week. (NDFA is the procuring authority and financial advisor)
- The N7 Newlands Cross PPP road project opened to traffic in November 2014, three months ahead of schedule. The N11 part of this project is on schedule for delivery in 2015. (NDFA was financial advisor)
- The Dublin Waste to Energy PPP project reached financial close during 2014 and construction is underway. (The NDFA was financial advisor)
The NDFA, in addition to being the financial advisor on the PPP component (totalling €1.4 billion) of the stimulus package announced by the Government in July 2012, is responsible for procuring all the non-road PPP projects in the package: the PPP component of the new DIT campus at Grangegorman, schools, primary healthcare centres and courthouses. The procurement competitions for these projects are all underway.
The NDFA is also delivering 15 non-PPP school projects on behalf of the Department of Education & Skills with a combined value of c. €80 million. Three “design and build” contracts were awarded in early 2014 and construction is underway at all sites.