Second appointment of 2022 with the BTP Italia, the government bond indexed to the national inflation rate designed for the individual saver. The Treasury slightly adjusted the trend compared to the June issue by shortening the duration from 8 to 6 years. A shorter duration that could increase interest among small savers. In June, the BTP Italia with a duration of 8 years raised € 7.2 billion from retail, approximately half compared to the over 14 billion of the previous issue (May 2020) which had a duration of 4 years.
In September, inflation in Italy jumped by 8.9% on an annual basis.
New issue starting on November 14th
The new issue will take place from Monday 14th to Thursday 17th November 2022. The characteristics of the security are substantially in line with those of the previous issues. The new BTP Italia will have a duration of 6 years and there is a loyalty bonus equal to 8 per thousand for those who buy the security upon issue and hold it until maturity, in 2028.
The share will be placed on the market in two phases: the first phase will take place from Monday 14 to Wednesday 16 November, unless closed early, and will be reserved exclusively for individual and similar savers (the so-called retail market); the second phase will take place in the morning of November 17 and will be reserved for institutional investors only. The guaranteed minimum rates will be announced on Friday 11 November.
The BTP Italia provides semi-annual coupons indexed to the FOIto which is added the payment of recovery of the inflation accrued in the half year (with the provision of a floor in the event of deflation to guarantee that the coupons actually paid are in any case not lower than the final guaranteed real rate), and single repayment at maturity.
The coupons are therefore paid every six months, starting from a guaranteed fixed rate for the entire duration of the issue, to which is added the national inflation recorded in the previous six-month period. This second variable component, linked to the trend of inflation, is the tip of the balance to determine the attractiveness of the issue. If inflation remains high over the next few years, the investor will find a valid one in the BTP Italia shield against dear life. Conversely, a sharp slowdown in inflation compared to current levels would make issuance less attractive.
How to subscribe to the new BTP Italia
Retail savers will be able to subscribe to the BTP Italia wherever a securities account is held, in a bank or at post offices, even using their home banking if enabled for trading functions.
The placement will take place on the MOT electronic platform (the electronic market for bonds and government securities of the Italian Stock Exchange) through the following dealer banks: Intesa Sanpaolo SpA and Unicredit SpA
All official communications on the BTP Italia, the FAQs, the information sheet and the technical note for operators will be made available on the website of the Ministry of Economy and Finance and on the website of the Department of the Treasury in the Public Debt section (www.dt. mef.gov.it/debitopubblico). It will also be possible to request support and information directly from the offices of the Department of the Treasury (MEF) via e-mail at [email protected].