Italy

Covered bond issuance from Europe’s peripheral regions is likely to be anaemic in 2021, as issuers will continue to rely heavily on far cheaper central bank funding. Covered bond spreads are very tight, but the cost of senior unsecured bonds has come down faster, and deposits have grown.

The Finnish financial sector wants to put the brakes on new measures aimed at completing the Banking Union, arguing that EU member states should move back into a clearly defined process of risk reduction.

Pirelli, the Italian tyres company, has issued its first convertible bond since its re-IPO on the Milan Stock Exchange in 2017, raising €500m.

Italian MPs are threatening to use a vote in parliament this week to derail a recent EU agreement on planned reforms for the European Stability Mechanism (ESM).

Scepticism about transition bonds has receded, according to Snam, the Italian gas distribution company that is the product’s leading issuer. While some ‘dark green’ investors still do not want to buy its bonds, many others do. One day, the company may officially be able to call its bonds green.

Banca Monte dei Paschi di Siena led a trio of speculative grade Italian banks into the euro bond market this week, as credit investors showed that no issuers were off limit in their increasingly desperate search for yield. Tyler Davies reports.

Sub-investment grade Italian lenders Banco BPM and Illimity Bank were well-supported in the euro bond market on Thursday, as investors showed they were more than happy to look at riskier names in their search for yield.

The resignation of Jean Pierre Mustier as group CEO on Monday night has laid bare deep fissures between the senior management of UniCredit, which has been focused on serving the interests of shareholders, and members of its board, which want to reposition the bank as a servant of the Italian economy.

Italian SME lender Illimity Bank is getting ready to sell its first senior bond by asking investors what sort of a price they would want to pay for the single B rated paper.

Banca Monte dei Paschi di Siena found plenty of demand for a new senior bond in the euro market on Tuesday, aided by growing speculation about the possibility of a merger with UniCredit.

Jean Pierre Mustier will retire as CEO of UniCredit in April, the bank announced this evening, as the board no longer agrees with his strategy. The change could mean UniCredit pivots towards Italian priorities and political influence.

Enel is planning €10bn of extra renewable energy investment in Europe, as a result of the support it hopes to get from the European Union’s €750bn recovery fund. But it believes the EU should refine its aid to subsidise sustainable finance more directly.