The auction of medium and long-term state financial products will be held on 11 June, the first in June. This is an auction that takes place every two months and usually includes four or five securities, between BTPs and CctEu. However, the Ministry of Economy and Finance has warned that a large part of this auction will be cancelled, with the exception of 3-year BTPs.
The reason for this cancellation is a syndicated issue. This is a dual tranche reopening of the 7-year BTP benchmark and the 30-year BTP benchmark. The details of this issuance, however, will be disclosed in the future.
What remains of the June 11th auction
The ministry’s communication has emptied the June 11 auction, which will follow that of the Bots, of almost all its financial products. Only a 3-year BTP remains, with the following characteristics:
- expires September 15, 2029;
- 3% annual coupon;
- first coupon payment date 15 September 2028 with a premium of 0.75%;
- maximum amount offered 4 billion euros;
- additional amount 1.2 billion euros.
Booking by the public must take place by June 10th, while applications for auction must be submitted by 11am on June 11th. Applications for the supplementary auction must be submitted by 3.30pm the following day, while the subscription regulations will be published on 15 June.
The syndicated issue that replaced auctions
The reason why only one government bond remained in what is normally one of the most varied auctions of Italian BTPs is that the Treasury has decided to replace all financial instruments with a duration of 10 years or more with two syndicated issues, therefore entrusted to a group of intermediaries instead of a public auction.
The products offered will be:
- a 7-year BTP expiring on 15 June 2033;
- a 30-year BTP expiring on 1 October 2055.
The banks involved will be Banco Santander SA, BNP Paribas, BofA Securities Europe SA, Goldman Sachs Bank Europe SE, JP Morgan SE and Morgan Stanley Europe SE. The 30-year BTPs will be available for a maximum of 5 billion euros no grow. The amount therefore cannot increase during the placement. The date of this issuance will be decided depending on market conditions.
The next auctions in June
With these changes, the June auction calendar looks like this:
- Wednesday 10 June, Bot auction;
- Thursday 11 June, 3-year BTP auction;
- Wednesday 24 June, auction of Short Term BTPs and BTP€i
- Thursday 25 June, Bot auction;
- Friday 26 June, medium-long term auction.
In addition, between 15 and 19 June, the Treasury will make available a new security, the Btp Italia Sì, indexed to inflation. The issue will be reserved for private individuals.
