The UK's $3 billion, five-year US dollar Eurobond issue showed
what European sovereigns can learn from the UK and vice-versa when
it comes to foreign-currency borrowing.
Announced on June 23, the UK deal was notable for its rarity,
being the sovereign's first dollar issue for seven years; its
pricing, beating the cost of domestic funding by around 10 basis
points and saving the UK taxpayer around £8 million; and the level of investor appetite.
The deal was also outstanding for its pricing through the
dollar curve, and for the speed of book building.
Citigroup, Deutsche Bank, Goldman Sachs and Morgan Stanley were
lead managers and joint bookrunners for the issue.
The bottom line is that dollar funding was cheaper than funding
in sterling through gilts at the end of June. So why aren't all
European sovereigns doing dollar deals?
Well, the UK deal was for a specific purpose. "The objective...
