Italy opened books on Wednesday for its first dollar-denominated bond sale in nearly a decade, with early investor interest exceeding $10 billion.
The southern European country is selling three dollar bonds of five, 10 and 30 years' maturity in a deal that has been more than a year in preparation.
Indications of interest from investors totalled more than $4.8 billion for the five-year bond, more than $3.1 billion for the 10-year and $2.1 billion for the 30-year issue, according to a document from one of the lead managers seen by Reuters on Wednesday.
Price guidance on the bonds is around 120 basis points over mid-swaps for the five-year, around 160 bps over mid-swaps for the 10-year and around 245 bps over mid-swaps for the 30-year. Pricing is expected on Wednesday.
Italy has deposited 389,400 dollars at the US Securities and Exchange Commission in New York to cover fees. These allow for a maximum placement volume of 3 billion dollars from US investors.
Rome is enjoying unprecedentedly favourable market conditions for its debt after the European Central Bank said in September it would resume a bond purchase scheme to boost the euro zone's stuttering economy.
The arrival of a new pro-Europe government in Rome last month, replacing the previous eurosceptic coalition, has also driven down yields on Italian debt, which are near record lows. The deal "highlights demand for dollar assets from certain investors that choose not to hedge some FX risk, which boosts the yield you get on the investment," said Andrey Kuznetsov, a senior portfolio manager at Hermes Investment Management in London.
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