BTp, 14 bn new 15-year benchmark issued: record demand at over 157 bn
The spread at which the bond was offered in the market is 8 basis points above the yield of the BTp maturity 10/1/2040
The second syndicated placement organised by the Treasury this year also followed the now customary path for this type of issue, gathering demand on the international markets equal to more than 10 times the supply. This time at stake was a new 15-year benchmark bond, reinforcing the long end of the curve after the seven-year bond offered last month: applications totalled some EUR 157 billion, i.e. 11.2 times the EUR 14 billion that the Ministry of the Economy decided to place in this operation managed with Banco Bilbao, BofA, Citybank, Deutsche Bank, Goldman Sacks and Jp Morgan. With these figures, the issue updates upwards the absolute record recorded on 8 January for an order book on a single BTp. In terms of amount issued, however, the record remains with the syndicated placement at the beginning of the year, which saw the placement of 15 billion for the seven-year bond. However, the new 15-year also remains at the top of the ranking, alongside the EUR 14 billion issued in June 2020 on the 10-year benchmark.
As usual, the intense demand helped contain the spread, which was limited to 8 basis points over the yield of the BTp maturing on 10 January 2040.
With these syndicated issues, the Treasury is aiming to take advantage of the long period of appreciation of Italian government bonds on international markets, boosted last Friday by the improvement in the outlook, from stable to positive, decided by S&P Global Ratings alongside the BBB+ rating assigned to our BTp, the premise of a possible promotion that after 14 years would bring Italian government bonds back to an A on the report card scale of one of the three main agencies.
