EU taps market after Ukraine, ratings hiatus

摘要

The European union, rated Aaa/AA+/AAA, issued its first debt for nearly 17 months on Tuesday, raising €2.6bn through a 1.875% 10-year bond offering to fund the financial assistance packages for Ireland and Portugal. The long-awaited deal has faced delays in recent weeks due to negotiations around Ukrainian aid and a scheduled ratings announcement, but was eventually launched on Tuesday through BNP Paribas, Credit Suisse, HSBC, ]P Morgan and UniCredit. The final spread of mid-swaps plus 9bp was at the tight end of plus 10bp area guidance and initial price thoughts at mid-swaps plus 11bp area released on Monday afternoon, offering a slim Ibp concession to the EU's outstanding curve, according to Tradeweb prices. A straight-line interpolation of the EU's 2.75% April 2022s and 3% September 2026s placed fair value on the new bonds, maturing in April 2024, at around mid-swaps plus 8bp.