MNI: New Italian Green Bond Maturities Seen Close To Existing

Any issuance of new Italian green bonds this year will have maturities close to those of existing 2031, 2035 and 2045 BTP Greens, sources from the Italian Treasury told MNI.

“Going beyond 2050 looks difficult, looking at the evolution of green bond demand in this period,” the sources said, though they added that it was possible the outlook could change over the course of the year.

The Treasury will keep to its overall commitment to issue more debt at the long end of the curve than in 2023, though it is still difficult to say whether this would come via a higher number of syndications, larger auction sizes or a combination of the two, officials said.

BTPsEi DEMAND

The Treasury sees “growing demand” for eurozone-inflation-linked BTPsEi, officials said, adding that it was possible this could be partly due to the decision by Germany to stop issuing linkers, as well as to continuing inflationary pressures.

BTPsEi net issuances were largely negative in 2023, but Rome announced an increased quota for the segment in its 2024 guidelines “considering the volume maturing”. A 10-year BTPsEi will mature in 2024 for a revalued amount of around EUR 16.5 billion.

The Treasury carried out its first BTP dual-tranche syndication since April 2021 on Jan 10, with both a new seven-year BTP and a tap of an existing 30-year.

“In case of favourable market conditions and consistent with the Treasury’s needs, new benchmarks for five, seven and 10-years can be launched via syndications,” the sources said, adding that the preferred method for selling new benchmark bonds will continue to be via ordinary auctions.

Total issuance of seven-year BTPs for this year will be in line with the EUR41.5 billion made in 2023, with at least two new benchmark securities, officials said.