Spanish Treasury places four billion euros in inflation-linked bonds for longer term, with greater demand and at lower cost than in 2017

The real yield of the issue was 0.565%, 16.8 points lower than the last indexed syndication from the Spanish Treasury in April last year and with a real coupon rate of 0.7%.

The high level of demand should be noted, which exceeded 18.4 billion and enabled the Spanish Treasury to assign the issue to 175 extremely high quality investor accounts; i.e. highly diversified both in terms of investor profile and geographical area.

With this issue, the Spanish Treasury has consolidated its commitment to a programme of European inflation-linked bonds which began in 2014. The aim was to diversify its sources of financing and lengthen the average life of the State's debt portfolio.

Non-resident investors accounted for 71.1% of the issue. Of this percentage, investors from the United Kingdom and Ireland accounted for 18.7%; France and Italy for 14.8%; Germany, Austria and Switzerland for 10.5%; the Nordic countries for 9.3%; the United States and Canada for 7.2%; the Netherlands for 7%; and the rest of the world for 3.6%.

By investor type, the largest share corresponded to banking treasuries (28.3%) while fund managers accounted for a similar percentage (26.8%). Other banking investors accounted for 15.1%; insurance companies and pension funds for 13.8%; leveraged funds for 7.8%; central banks and official institutions for 7%; and other investors for 1.2%.

With this fourth syndication in 2018, the Spanish Treasury has now issued a total of 105.41 billion euros in medium- and long-term bonds. This represents 80.3% of its bond issue target for the whole year (131.31 billion euros). Following this issue, the average lifetime of State debt in circulation stands at 7.53 years.

BNP Paribas, Crédit Agricole, Goldman Sachs, J.P. Morgan, Morgan Stanley and Société Générale acted as bookrunners for this issue. The rest of this group of Market Makers in Treasury Bonds and Debentures acted as co-leaders.

Non official translation