Banco BPM AT1 caught out by market moves

摘要

BANCO BPM fell foul of a softening market as it brought forward an Additional Tier 1 offering last Tuesday amid renewed political turmoil in Italy, ultimately launching the €400m deal in line with initial price thoughts, but at the lower end of its size target. While euro-denominated sub debt has been in short supply so far this year, market participants have been almost unanimous in predicting that AT1s will be highly sought after in 2021, as investors look for yield and eye potential compression of AT1s towards lower beta products. But, caught out by market moves, BPM was unable to capitalise on that view.