Nobody wanted to rain on the parade of NTMA boss Dr Michael Somers last week as he unveiled his organisation's annual report. Remember Somers and his staff have now managed to raise over 90% of Ireland's borrowing requirement for 2009 amid the most turbulent conditions ever seen on international bond markets .
Somers and his colleagues are reported to be paid well for their work, according to the recent An Bord Snip Nua report, but with 2010's bond markets look equally challenging don't expect the government to be imposing too much austerity on Somers and Co any time soon.
Somers had a few sleepless nights earlier this year as bond issues failed to attract the usual levels of demand and media attention from the UK became extremely hostile. That has all passed for now and Irish bond yields are plunging downward and bond auctions are attracting plenty of interest.
So how did Somers (and by implication the government) make it through the storm? In large measure by relying on the Irish banks to buy up Irish bonds, that is how. Last week Somers said nobody twisted the arm of the Irish banks to get involved, but it's clear that at crucial periods their involvement was vital to getting certain auctions over the line.
In one syndicated issue for instance – for a 3.9% bond that matures in 2012 – Irish institutions gobbled up 55% of the issue. While everyone knows the Irish banks have been "supportive" of Irish bond auctions, that level of interest is far more than just putting a minimum floor under the demand levels.
The banks will obviously participate because they can submit the bonds to the ECB as collateral and get liquidity in exchange, but it's clear that Irish banks pulled out all the stops to help Somers at his most vulnerable moment as a treasury manager earlier this year.
Not that Somers will be reciprocating. He now plans to encourage the public to buy up Irish government bonds themselves which is great news for the exchequer, but bad news for banks who are desperate to mop every spare drop of cash to bolster their deposits. It seems you can either have well capitalised banks or a well capitalised state, but you can't have both.