Duration, duration, duration is the cry from investors
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Duration, duration, duration is the cry from investors

While France's 50-year OAT is creating a new segment on the euro yield curve, many other sovereigns are making the most of the clamour for long-dated bonds

Issuers: France; Greece; Poland

Sizes: e6 billion; e5 billion; e500 million

Lead managers: Barclays Capital, BNP Paribas, Deutsche Bank, HSBC (France); Alpha Bank, EFG Eurobank, HSBC, Lehman Brothers, Merrill Lynch (Greece); ABN Amro (Poland)

Dates: January - February 2005

AFT's 50-year bond
Distribution by investor type

Old and new Europe have come to the markets this year as sovereign issuers continue their move well beyond 10-year bonds.

With Agence France Trésor (AFT) launching its 50-year OAT last month, it's easy to forget that European sovereigns have a history of avoiding long-dated issues, particularly those secondary sovereigns that have managed their debt programmes to appeal to non-domestic investors. But following last year's celebrated 2020 deal by the European Investment Bank, non-eurozone countries like Poland are issuing longer-dated paper.

It's a good time to do this. Supply is down. Between mid-January and mid-February, the amount of seven-year to 30-year euro-denominated bonds outstanding fell by around euro20 billion. Supply is also down in US Treasuries longer than seven years.

Poland's new record

On January 21, the Polish Ministry of Finance priced a 30-year e500 million bond at 29 basis points over mid-swaps, to yield 4.489%.

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