The pool of banks entrusted with the syndicated placement of a new green Btp announced: BofA Securities Europe, Citibank Europe, Crédit Agricole Cib, Deutsche Bank, and Monte dei Paschi di Siena capital services corporate bank
The net proceeds of the issuance will be reserved for a range of sustainable expenditures included in the State Budget for the current year and in the final accounts for the previous three years. We are talking about 36.3 billion euros
New green Btp on the launch pad, maturing in 2035. The Ministry of Economy and Finance, in a note released Sept. 5, announced that it has mandated five banks for the syndicated placement to be carried out “shortly, according to market conditions.” The five banks are BofA Securities Europe, Citibank Europe, Crédit Agricole Cib, Deutsche Bank, and Monte dei Paschi di Siena capital services corporate bank.
The net proceeds of the issuance, the note says, will be reserved for a pool of sustainable expenditures included in the State Budget for the current year and in the final accounts for the previous three years. We are talking about 36.3 billion euros earmarked for six objectives: renewable sources for electricity and heat production (110 million euros), energy efficiency (8.55 billion), transportation (24.236 billion), pollution prevention and control and circular economy (614 million), environmental protection and biological diversity (1.978 billion) and research (816 million).
Green BTPs: what they are
Green BTPs are medium- to long-term Italian government bonds aimed, in fact, at financing expenditures that promote the country’s ecological transition. Like other multi-year Treasury bonds, they “guarantee a fixed income established by the coupon, paid semi-annually, and the repayment of the nominal value at maturity,” the Mef explains. Institutional investors can trade them on the regulated wholesale secondary market (Mts) in the case of transactions exceeding 2 million euros and on unregulated markets for others; as for individual savers, they can trade them on the Electronic Market for Bonds and Government Securities (Mot) or other trading platforms. In general, the minimum denomination cannot be less than 1,000 euros.
Green BTPs: what they finance
Expenditures that can be financed by green BTPs belong to two clusters of objectives. First, those outlined by the European Taxonomy of Sustainable Activities:
But also some of the 17 Sustainable Development Goals of the United Nations 2030 Agenda:
Finally, looking at placement methods, green BTPs can be issued through syndicated placement or “marginal auction with the discretionary determination of the allotment price and quantity issued,” the Mef points out. “In the latter case, each issuance decree will describe in detail the characteristics of the issue and the terms of the supplementary placement reserved for Government Bond Specialists, technically configured as a subsequent tranche.”
