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Dual syndication: 10-year BTP / 30-year BTPei

ITALY AUCTION PREVIEW
  • A dual-tranche syndication has been announced to launch a new 10-year BTP maturing Aug 1 2031 and a new 30-year BTPei maturing May 15, 2051. We expect that transaction to take place today.
  • This will be the second Italian syndication of 2021 following the launch of the 15-year 0.95% Mar-37 BTP whose transaction took place on 5 January.
  • The current 10-year BTP was launched via auction (rather than syndication) in September and currently has E16.1bln outstanding. Prior to this, the 1.65% Dec-30 BTP (the previous 10-year benchmark) was launched via syndication in June, raising E14.0bln with a book size of E107.9bln.
  • Given that this is a dual tranche transaction, we look for a size in the region of E10bln for the new 10-year BTP.
  • There were no BTPei syndications in 2020 (although there was a BTP Italia launched). The last BTPei syndication was back in October 2019 which saw the 10-year 0.40% May-30 BTPei launched. This saw a transaction size of E4.0bln with books of E22.1bln.
  • Given the high demand for longer-duration debt at present and the reflation trade which remains in full swing, we expect strong demand for the new 30-year BTPei. We look for a transaction size of E4-6bln.
  • Timings: As a guide we look at the latest syndicated transaction on 5 January and the dual-tranche syndication on 21 April, 2020:
    • Books open: 9:45GMT, dual: 10:00GMT
    • Spread set: 11:18GMT, dual: 11:39GMT
    • Books close: 11:45GMT, dual: 12:00GMT
    • Launched: 13:45GMT, dual: 14:04GMT
    • Priced: 15:34GMT, dual: 16:39GMT
  • Bookrunners: Citi, Deutsche Bank, Goldman Sachs, Monte dei Paschi di Siena and Nomura.
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