Tesoro launches short and long term BTPs

According to what was disclosed in the issuance program of the Ministry of Economy and Finance, in the third quarter of 2024 the Treasury will launch BTP Short Term (expires 08/28/2026) for at least 9 billion euros, 5 year BTP (expires 01/10/2029) for at least 10 billion euros and 10 year BTP (expires 02/01/2035) for at least 10 billion euros.

Treasury launches short and long term BTPs

The minimum amount refers to the value that the outstanding amount of the security must necessarily reach before being replaced by a new issue on the same maturity. During the third quarter, additional new securities may also be issued based on financial market conditions.

Reopenings of outstanding securities

In the third quarter of the year, further tranches of the following securities currently being issued may be offered: BTP entitlement/maturity date 17/06/2024 – 15/07/2027 and coupon 3.45%, BTP entitlement/maturity date 01 /03/2024 – 01/07/2029 and coupon 3.35% BTP entitlement/maturity date 15/05/2024 – 15/07/2031 and coupon 3.45% BTP entitlement/maturity date 01/03/2024 – 01/07/2034 and coupon 3.85%.

Furthermore, depending on market conditions, the MEF reserves the right to offer further tranches of nominal securities being issued with a maturity exceeding 10 years, CCTeu and indexed to inflation also in order to take into account any dislocation on the secondary market of these securities. Finally, the MEF will be able to offer further tranches of medium and long-term securities, nominal – at fixed and variable rates (CCTeu) – and indexed to inflation, no longer being issued, to ensure the efficiency of the secondary market.

Trend of issuing activity

At the end of May 2024, the MEF issued medium-long term government bonds for a total nominal amount of approximately 186 billion euros. The funding activity, pFor the same period, in addition to covering the needs of the State Sector, it made it possible to refinance maturing medium-long term government bonds, including the amounts repurchased in exchange and buyback operations, for a total amount of approximately 130 billion EUR. For the rest of the year, from June 1st to December 31st, the funding activity will have to take into account the maturities of medium-long term government bonds for a total amount of 139 billion euros, to which the share of State Sector Requirements for the same period must be added.

The numbers

Taking into account the current cash availability, the issues carried out in the month of June and those already announced which settle by June 30th, equal to circto 27 billion euros, compared to the end-of-year objectives, for the remaining part of 2024, from 1 July to 31 December, gross issues of medium-long term securities are therefore estimated in the area 135-155 billion euros. Considering the maturities, this implies an estimate of net issues of approximately -4/+16 billion euros in the same period.

At the end of May 2024, therefore, the progress of the emission program for the current year stood at over 50%, a percentage which rises to 61% if emissions made are included e those already announced that settle in June.