UniCredit successfully reopens market for Italian Covered Bonds by issuing a dual tranche Obligazioni Bancarie Garantite

Client successes

On 6th June 2023, UniCredit reopened the Italian covered bond market (Obligazioni Bancarie Garantite) with a dual tranche EUR1.75bn long 3 y and EUR1.25bn long 7y issuance.

This is the first OBG issued by UCG Spa after an almost 7-yr absence, and the first OBG since the Italian authorities passed law amendments transposing the European Covered Bond directive into Italian law in December last year. 

Crédit Agricole CIB acted as active joint bookrunner for this transaction. Participation in the reopening of the OBG market with a landmark transaction further demonstratesour leadership as a debt house.

This trade sets a valuable benchmark for next OBG issuances, which will benefit from the price discovery exercise performed by an experienced national champion issuer such as UniCredit in the covered bond space.”  Maurizio Gozzi, Managing Director, DCM FI & SSA Italy

UniCredit announced the dual tranche mandate on Monday afternoon. Investor feedback was positive. With a favourable and stable backdrop, UniCredit opened the books on Tuesday 6 June with an initial guidance of MS+35bps for the long 3y and MS+65bps area for the Long 7y. 

The order book quickly grew to EUR 5bn across 200 combined line orders. This allowed the company to upsize the deal to EUR 1.75bn for the Long 3y and EUR 1.25bn for the Long 7y. Final book was EUR4.8bn largely skewed to bank treasuries and AMs high quality investors. This jumbo transaction illustrates investors’ appetite for quality Italian covered bonds after 12 months of non-issuance and following a reshaped investor-friendly relative value scheme as a consequence of the CBPP (Covered Bond Purchase Programme) termination.

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