EGB Supply

Belgium is still due to hold an ORI operation this week. France, Slovakia, the Netherlands, Germany and Italy have all to the market already (in addition to retail operations). We pencil in estimated gross issuance (ex-retail) for the week at E25.3bln, down from E30.0bln last week. We also note the huge redemptions and coupon payments.

• On Friday, Belgium will come to the market to hold an ORI operation. There will likely be two off-the-run OLOs on offer for a combined E500mln. Details will be announced on Thursday.
• Italy is due to launch a new retail-only 6-year Mar-30 BTP Valore (ISIN: IT0005583478) this week. Books opened on Monday and already stand at E14.65bln sold across the first 3 days (E6.44bln sold on day 1, E4.611bln sold on day 2 and E3.603bln on day 3; similar to the E14.85bln across the first three days for the 4-year in June and in excess of the E12.89bln seen for the 5-year in October). Unless there is an early close, books are due to close at 13:00CET on Friday 1 March.
• Note that subscriptions for the next retail-only Belgium State Bonds (Bons d’Etat) opened on Thursday 22 February. Belgium plans to launch a new 1-year issue (ISIN: BE3871294240) and a new 3-year issue (ISIN: BE3871295254). Takeup on the first two days has been very low: E223mln in total for the 1 year (E146mln on day 1 and E77mln on day 2) and E10mln of the 3-year (E5mln on each of day 1 and 2). So, unless there is a big increase in takeup this week, it appears as though the takeup will be low – and that will increase the risk that OLO / TC issuance targets may need to be revised higher later this year. The BDA had announced that there will be a combined limit of E6.0bln across the two issues and across 2024 expected to sell E13.5bln via 1-year Bons d'Etat and E2bln via 3/2/8/10-year Bons d'Etat.. The subscription window is planned to be open until Friday 1 March but there is a possibility of an early close.

EZ240229.pdf