BTp, hunt for foreign investors with the first syndicated 2026 issue
With the mandate for the placement of the new seven-year benchmark and the reopening of the BTp Green 2046, the Mef seeks to intercept demand from across the border, which drove the six successful transactions last year
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The Treasury is wasting no time and is starting to move right away to finance Italian debt. As has become customary in the early days of the year, the Mef has in fact mandated a pool of banks to manage through syndication a dual tranche issue of a new benchmark 7-year BTp, maturing on 15 March 2033, and a reopening for an amount not exceeding EUR 5 billion of the BTp Green with a coupon of 4.10% and maturity on 30 April 2046. The operation, entrusted to Banca Monte dei Paschi di Siena, Barclays Bank, BNp Paribas, Crédit Agricole, Morgan Stanley and NatWest Markets, will be carried out in the near future, depending on market conditions, and therefore barring any surprises as early as tomorrow, 8 January.
Successes achieved in 2025
The year 2025 closed with a sharp contraction in the spread between the BTp and Bund, which fell to a 15-year low of just under 70 basis points, and a reduction in the average cost at issuance of Italian government bonds to 2.75 per cent from 3.41 per cent twelve months earlier. However, the new year opens with a task that is as challenging as ever for the Treasury, which, according to the newly published public debt management guidelines, will be called upon to place medium- and long-term bonds for a total gross amount of between 350 and 365 billion. Crucially, in a context in which the ECB will continue to reduce its BTp portfolio by a further 72 billion after the 73 billion already cut this year, it will focus on additional demand, which could once again come from abroad.
The support of foreign investors
In the first ten months of last year, investors from across the border made net purchases of Italian debt for 106 billion euro, keeping intact the appetite that has persisted since mid-2023 (260 billion euro in inflows since then, after the 140 billion euro post-pandemic 'flight'). International banks and funds have been the main driving forces behind the six syndicated transactions conducted by the Treasury over the past 12 months, some of which have registered record requests even exceeding 200 billion: a tried and tested scheme that the Mef expects to put into play in 2026 as well, starting tomorrow.
