Italian government issues €5.5bn in bonds to tackle COVID-19

This is the third issuance of BTP Futura bonds, which aim to help ease the economic dislocation brought about by the pandemic.

Posted Thursday, April 29th 2021
Italian government issues €5.5bn in bonds to tackle COVID-19

The Italian government has issued €5.48 billion for purchase by retail investors in the form of BTP Futura bonds that aim to finance Italy’s vaccine programme.

With a 16-year maturity, and a coupon rate that is unchanging for the first four years before potentially being revised upwards every four years depending on market conditions, the bond will be repaid in two tranches: at the end of the first eight years, and upon maturity.

This is the third BTP Futura issuance; the first two were aimed at easing the economic dislocation brought about by the COVID-19 pandemic. The bonds are the only kind of Italian bonds aimed exclusively at retail investors, and indeed, anyone around the world can buy them (except, for technical regulatory reasons, people based in the USA). 96% of the bonds’ initial purchasers were domestic investors.

Simmons & Simmons advised the dealers (Intesa Sanpaolo and Unicredit) and the co-dealers (Banca Akros and Banca Sella Holding) on the structuring and documentation of the transaction; Dentons advised the dealers and co-dealers on the compliance and tax elements.