Portugal is preparing a syndicated ten-year issuance next week

  • ECO News
  • 5 January 2018

Portugal should start the year with a syndicated ten-year issuance, as it has been the case for the past few years, according to Commerzbank.

Portugal should announce this Friday a syndication of ten-year Treasury Bonds, a financing operation that should be performed next week, according to Commerzbank; it has been one year since Portugal made a similar syndication. Portuguese interests are falling, which means markets are comfortable with this issuance.

“In primary, Portugal should not announce today to utilize next week’s issuance window for regular auctions, but instead opt for a syndicated new 10-year PGB [Portuguese Government Bonds], taking advantage of near record-low funding conditions with 10-year yields below 2% while the 20 bp [basis points] back-off since mid December suggests markets have already made room”, was written by the German bank analysts Marco Stoeckle and Michael Leister in a note disclosed this Friday morning, accessed by ECO. Those analysts anticipate the issuance to stand between three billion and 3.5 billion euros.

If it is confirmed, Portugal will start the year with the issuance of a new line which will be supported by a syndicate of banks that will deal with the operation with the Portuguese Treasury and Debt Management Agency (IGCP), which is responsible for these kinds of financing, as it happened in the beginning of last year. ECO tried to contact the entity headed by Cristina Casalinho, but no answer has been provided yet.

This morning, the Portuguese Government debt interests are falling in most maturities. The implied yield for ten-year securities give in 4.3 basis points to 1.876%. The rate for five-year bonds is falling 3.8 basis points to 0.404%.

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