UPDATE 2-Loomis’ Fuss says buying Irish govt bonds

* Fuss bought debt maturing in 2018 at Sept auction

* Says: ‘Worries valid, but credit actually very decent’

* S&P sovereign ratings chief more sanguine on Ireland

(Adds Ireland’s yields, Fuss views on credit quality)

By Jennifer Ablan

NEW YORK, Oct 13 (BestGrowthStock) – Dan Fuss, who as vice chairman
of Loomis Sayles helps oversee $150 billion, said on Wednesday
the firm has been buying Irish government debt aggressively in
recent weeks for its attractive yield and “very decent” credit
quality.

“We have a completely different view of Irish debt than the
rest of the world,” Fuss told Reuters. “The bonds have been and
continue to be cheap. Their yield is attractive relative to the
view expressed in the market on Ireland’s credit quality.”

Fuss said Loomis has been a buyer in the secondary market
and took part in Ireland’s 1.5-billion-euros debt auction,
purchasing the bonds maturing in 2018 which were priced at an
average yield of 6.023 percent. In total, Loomis holds roughly
$1.5 billion of Irish government debt.

Last week, Fitch Ratings downgraded Ireland’s credit rating
to “A-plus” from “AA-minus” and put it on a negative outlook,
pointing to the bigger-than-expected cost of cleaning up the
country’s banks and uncertainty over its economic recovery.

“The worries about Ireland are valid, but the credit over
time — and I don’t mean in the next 27 days or so — is
actually very decent,” Fuss said.

Ireland’s recent bond auction, which was part of its
planned 20 billion euros bond issuance for 2010, met with solid
demand although Dublin had to pay a higher price for the bonds
to be sold. Ireland sold 500 million euros of 4 percent January
2014 bonds at an average yield of 4.767 percent, and 1 billion
euros of the 4.5 percent October 2018 bond at an average yield
of 6.023 percent.

The flurry of negative headlines spiraled after Moody’s
said last week it, too, might downgrade Ireland and drove up
Irish borrowing costs, putting further pressure on a government
saddled with a debt pile set to hit 155 billion euros this year
— or 100,000 pounds for each of the country’s 1.5 million
households.

For their part, Standard & Poor’s sovereign ratings told
Reuters that concerns about political and fiscal risks in
Ireland are exaggerated.

“There is still downside risk if there is more bad news
coming out of the banking system — and there may be a little
more of that — but we’re reasonably confident that the
political consensus about fiscal consolidation is going to
remain intact,” said David Beers of S&P. For more details
please click on [ID:nN11124708]

(Editing by Jan Paschal and Andrew Hay)

UPDATE 2-Loomis’ Fuss says buying Irish govt bonds