Statistics on securities issues of Irish financial and non-financial firms: December 2012

20-2-2013 — /europawire.eu/ — At end-December 2012, the outstanding amount of debt securities issued by Irish financial and non-financial firms, and the Government was €1 trillion (or a reduction of approximately 2 per cent since December 2011). This contrasts with a year-on-year increase of more than 1 per cent across the euro area.

Market-based debt financing for the banking sector contracted during December with net redemptions of approximately €160 million. The outstanding amount of debt securities for this sector saw a year-on-year fall of 25 per cent to €84.4 billion with 38 per cent (or €32.3 billion) of this amount falling due within the next 12 months.

The outstanding amount of long-term Government debt stood at €87.9 billion; this represents a year-on-year increase of 3 per cent. At end-December 2012, Irish resident investors accounted for 28 per cent of long-term Irish Government bonds compared with 22 per cent in December 2011.

Equity shares had an outstanding value of €207.1 billion at end-December. This includes quoted shares issued by Irish residents (€206.7 billion) which saw a year-on-year net increase of 27 per cent (driven primarily by increases in the non-financial corporate sector). The value of the stock of quoted shares in the euro area increased by approximately 16 per cent in the year to December.

Government Debt Issuance:

Long-term Government debt fell to €87.9 billion in December 2012[1]. This represented a year-on-year increase of approximately 3 per cent when compared with December 2011 (€85.4 billion). Almost €16.4 billion (or 19 per cent) of the euro-denominated long-term debt will fall due over the next 3 years (see Table 1). More than €10 billion (or 62 per cent) of this latter figure is payable to non-resident investors.

As part of its normal operations in the secondary market, the NTMA acquired €500 million of a 5% Treasury Bond[2] which it then cancelled. Following this cancellation, the nominal outstanding amount for this bond was reduced from €5.616 billion to €5.116 billion.

Holdings of Government Bonds:

At end- December 2012, Irish resident investors accounted for 28 per cent of long-term Irish Government bonds compared with 22 per cent in December 2011. The Irish banking sector accounted for a significant portion of this increase due to banks’ demand for Government bonds to use as collateral for monetary policy operations. This sector accounted for 25 per cent of all holdings at end-December 2012 (or €21.8 billion), compared with 18 per cent at end-December 2011.

Approximately 49 per cent of all resident holdings will mature within the next 5 years. Furthermore, 41 per cent (or €25.8 billion) of those long-term bonds held by non-resident investors will mature between 2020 and 2025 (see Figure 2).

Detailed historical information from 1969 on the Securities Holdings Statistics are published here.

Banking Sector:

Market-based debt financing for the banking sector contracted during December with net redemptions of €160 million (compared to net redemptions of €4.2 billion in the previous month). Following on from Bank of Ireland’s re-entry to the international bond market in November, AIB[3] completed a €500 million covered bond issue in December[4] 2012. This 3-year Asset Covered Security (ACS) Bond was 4-times oversubscribed with over 95 per cent of the demand coming from outside Ireland.

The outstanding amount of debt securities for this sector saw a year-on-year fall of 25 per cent to €84.4 billion with short-term debt contracting by 46 per cent. Approximately €32.3 billion (or 38 per cent) of the total debt securities issued by the banking sector will fall due within the next 12 months. Over the past 12 months, the total outstanding amount of debt securities for this sector across the euro area decreased by more than 1per cent.

The outstanding amount of the banking sector’s equity securities remained broadly unchanged in December 2012 at €15.7 billion. This represents a year-on-year increase of almost 7 per cent.

Non-Financial Corporates:

The outstanding amount of debt securities issued by non-financial corporates (NFC) increased by almost €490 million (or 20 per cent) to approximately €2.9 billion at end- December 2012. This represents a 5 per cent decrease from December 2011. More than €100 million (or 4 per cent) of the total debt securities issued by the NFC sector will fall due within the next 12 months. The year-on-year increase in the outstanding debt securities for NFCs resident in the euro area was approximately 13 per cent.

In December 2012, the equity securities outstanding for the NFC sector increased by almost €10 billion (to €178.1 billion). This represents an increase of 31 per cent when compared to December 2011. The annual percentage change in market capitalisation for NFCs in the euro area was approximately 14 per cent.

Detailed tables can be found on the Central Bank of Ireland’s website here. The data are largely compiled from an ESCB securities reference database, the Centralised Securities Database.

Notes:

• The statistics are based on Irish resident sectors issuances of securities where an ISIN[5] code is assigned, irrespective of the market of issue or listing. Non-ISIN information is also provided for monetary financial institutions.
• Debt securities are broken down according to their original maturity and coupon type. Equity securities are classified into quoted and unquoted securities excluding investment fund shares/units.
• The difference between month-on-month equity stocks reflects valuations changes transactions in addition to transactions and other adjustments, for example, reclassifications and corrections.
• The data reflect revisions arising from data quality management activities performed by the Bank, which contribute to improvements in the data.
• Euro area figures are sourced from the ECB’s Euro Area Securities Issues Statistics monthly publication.
• The methodological notes guiding the compilation of these statistics can be found on the ECB’s website.

[1] Refers to debt securities in all currencies (but principally includes euro-denominated debt)