BTp Italia Sì: funds raised total 8.84 billion
281,140 purchase contracts were signed in one week. The base fixed rate was confirmed at 1.6 per cent per annum
The total for the first BTp Italia Sì issue, which has just concluded its week-long issuance period, stands at 8.843 billion with 281,140 contracts.
A comparison with previous cases
In its debut, the new government bond reserved for retail investors and indexed to Italian inflation exceeded the subscription figures of the last four issues of the traditional BTp Italia, ranking third in the historical series of 14 offers, each of which featured a separate retail phase prior to the final day reserved for institutional investors.
Unreleased double track
The first of the two key new features of the BTp Italia Sì is precisely its exclusive focus on savers and households, to whom all five days of the issue were therefore dedicated, with no allocation set aside for large investors.
The second, more significant change lies in the simplified mechanism for calculating returns, which will be based on the sum of the fixed base rate and the inflation rate for the six-month period between one coupon payment and the next. For the fixed portion, the Treasury has confirmed the 1.6 per cent per annum indicated as the guaranteed minimum on the eve of the issue, a predictable decision given the dynamics of the bond markets, which this week have been buoyed by the agreement between the US and Iran. Developments in the geopolitical landscape will also determine the fate of the variable component, which is measured against inflation (the FOI index, used by Istat to track price movements in the basket of goods for blue-collar and white-collar households). But here, certainties are hard to come by.
Price outlook
The news of the agreement has allayed fears of a surge in prices such as those envisaged in the ‘adverse’ or ‘severe’ scenarios put forward by various forecasters. However, it certainly does not herald a rapid easing of inflation: inflation is yet to factor in the fallout from the energy price surge over the coming months, and must contend with the many uncertainties of an agreement that will not go down in history as a diplomatic masterpiece. Savers have clearly been aware of all this, and have in fact responded with fairly strong demand for the Treasury’s offering.
