Ireland emerged as America’s fourth-largest creditor following China, Japan and the Cayman Islands after the US government revised the way it reports the figures.

Investors in the European nation owned $264.3 billion of Treasuries at the end of March, based on official data issued Monday. China is the largest holder with a $1.24 trillion stake. Japan is next with $1.14 trillion, followed by the Cayman Islands with $265 billion.

Ireland’s holdings are bigger than the size of its economy, which is worth about $230 billion for a population of less than five million. One potential explanation is the large number of fund managers and other companies based in the country for its tax incentives.

“It’s all just foreign banks, funds and corporates based here,” said Owen Callan, a fixed-income analyst at Cantor Fitzgerald in Dublin. “It’s probably linked to offshore mutual funds administered here or offshore-retained earnings of US multinationals.”

More than 700 American companies are domiciled in Ireland, employing 140,000 people, data from the American Chamber of Commerce show. And of the $1.62 trillion held by global funds administered in the nation, $337 billion is in government bonds including Treasuries, according to the Bank of Ireland.

The Treasury Department released details of the holdings among the countries in OPEC and the Caribbean in response to a freedom-of-information Act request submitted by Bloomberg News, dropping its practice of grouping them together. Analysts track overseas demand for Treasuries because investors from outside the nation own 47 per cent of the $13.4 trillion debt market, the biggest in the world.

“We recently undertook a thorough data and legal analysis to determine if we could report data in a more comprehensive and transparent fashion,” said Whitney Smith, a spokeswoman for the Treasury Department. “We concluded that it was consistent with transparency and the law to disclose the data in a disaggregated fashion.”

Bloomberg