July 7, 2020 / 3:44 PM / a month ago

Orders for Italy's new 'BTP Futura' bond at 1.68 bln euros on 2nd day

MILAN, July 7 (Reuters) - Orders for Italy’s new ‘BTP Futura’ retail bond to fund coronavirus recovery spending reached 1.68 billion euros ($1.90 billion) on the second day of offering, bourse data showed on Tuesday.

Italy’s Treasury said last month it would offer the new 10- year BTP bond dedicated to retail investors from July 6 to July 10. Proceeds from the sale will be used to fund measures to help the economy recover from the coronavirus epidemic.

“With that numbers in the first two days, we can say it’s a good start. It makes no sense to make comparisons with BTP Italia bond because they are different both in duration and coupon,” said Filippo Mormando, strategist at MPS Capital Services.

The issue envisages a step-up mechanism for coupon rates, with a minimum guaranteed annual coupon of 1.15% for the first four years, rising to 1.30% from the fifth to the seventh year and then further to 1.45%.

Retail investors’ demand will be met in full and the bond includes a ‘loyalty’ premium for investors who hold the notes to maturity.

Orders for the issue reached 2.37 billion euros ($2.68 billion) on Monday, the first day of offering, bourse data showed.

$1 = 0.8856 euros Reporting by Sara Rossi, editing by Francesca Piscioneri

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