Commission: 5 billion for the first syndicated “EU bond”

THE European Commission yesterday raised €5 billion in its first syndicated transaction for 2023, thanks to the issuance of of its 30-year bond which expires on 4 March 2053. This is the first syndicated issue under the EU’s unified funding approach, which the Commission introduced as the main funding method from January 2023. Under this approach, the Commission — on behalf of Union— issues bonds under the single name “EU bonds” and not under different names depending on the programs.

The transaction attracted strong interest from investors across Europe and the world. It was oversubscribed more than 10 times, with bids exceeding €51 billion.

Budget Commissioner Johannes Hahn, who oversees EU borrowing, said: “Our first syndicated transaction in 2023 marks a dynamic and confident start to the current EU borrowing year. The overwhelming demand for our bonds demonstrates the scale and extent of the investment base that the EU has developed for its borrowing activity. We will maintain a strong presence in the markets over the coming weeks and months as we move forward with the implementation of our release plan as part of our unified financing approach. »

With yesterday’s transaction, the Commission raised almost €10 billion of the €80 billion it had set as a funding target for the first half of 2023. The amount raised so far includes €4.68 billion raised in early January through an EU bond auction. Of the €80 billion funding target, around €70 billion will go to NextGenerationEU and around €10 billion to Ukraine.

George Fellidis

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