NTMA withdraws J+E Davy authority to act as Primary Dealer
Monday March 8th: In a statement issued this afternoon, the NTMA made the following announcement: 'The Board of the National Treasury Management Agency (NTMA) has withdrawn J&E Davy's authority to act as Primary Dealer in Irish Government bonds with immediate effect'.
This additional sanction on the firm strikes at the heart of the business of the Republic's historic no 1 stockbroking firm whose business model was always closely entwined with its trusted role as a primary intermediary between the sovereign's gilt and bonds fundraising and the financial markets.
"The Board reached its decision based on its assessment of the very serious findings relating to the firm that were made by the Central Bank of Ireland last week and following engagement with investors in Irish Government debt over recent days", the statement said.

"A primary concern for the NTMA is to maintain the reputation of Ireland as a sovereign issuer in the bond market and the orderly functioning of the market for Irish Government debt. In this context, the NTMA believes that the behaviour described in the Central Bank findings falls substantially short of the standards expected from market counterparties, peers and colleagues in the bond market and is potentially damaging to Ireland’s reputation as a sovereign issuer", the statement continued.

The move follows the sanctioning of the firm by the Central Bank of Ireland following its investigation into insider dealing which involved 16 senior Davy executives, many of whom hold equity in the firm, with a fine of €4.1 m last week. The fine was imposed by the Central Bank for four breaches of MIFID regulations between July 2014 and May 2016.

The Central Bank action followed an investigation detailed in a press release of over 4,000 words by the Central Bank. Davy employs over 700 staff and aside from its primary bond dealing role is a leading equity broker and corporate finance, wealth management, pensions and funds adviser. Three of the leading executives resigned last week, with the CEO stating that his continued involvement in that role would damage the reputation of the firm going forward.