Italy

Assicurazioni Generali and Uniqa Insurance are each looking at selling tier two capital from their green bond frameworks, using a quieter period in the new issue markets to explore more complicated and multi-faceted transactions.

Lagfin, a vehicle that manages the investments of the billionaire Garavoglia family, has issued a €330m bond exchangeable into iconic Italian drinks maker Campari, as part of a move to shift the historic company’s domicile to the Netherlands.

European banks jumped into the US dollar market this week, with some issuers clocking up huge savings in the currency versus what their home markets could offer.

Generali agreed to take a large stake in fellow Italian insurance company Cattolica this week. The deal includes plans for a €500m capital increase, which takes the pressure off Cattolica to boost its solvency position and means the firm will no longer seek to access the market for restricted tier one debt.

UniCredit opened books on Tuesday for what could be its last capital transaction of the year. The bank favoured the dollar market for its new tier two, having sold a senior transaction in euros only last week.

Recent share price movements imply that a third of the loans under moratoria at Italian banks could end up as unlikely to pay (UTP) exposures, according to analysts at Equita, an investment bank, who expect that the true figure could be closer to 10%.

Bankers close to SIA, the state-owned Italian payments company, say they expect that it is more likely to pursue a merger with fellow Italian payments company Nexi rather than a listing in Milan this year. However, GlobalCapital understands that SIA is still running a dual-track process, meaning hopes of a public sale are not dead yet.

Italy’s first IPO since the Covid-19 crisis, from medical filter and mask manufacturer GVS, has been priced in Milan. Now, there is hope of further listings on the exchange, despite jitters among domestic investors.

BPER Banca said on Monday that it would buy more loans and branches than expected as part of its involvement in a potential tie-up between Intesa Sanpaolo and UBI Banca. The merger process hit a snag last week, but market participants hope that a deal can still be agreed.

UniCredit jumped into the euro market to raise senior funding at a pricing level it found much more familiar than recent elevated levels this week, while BPER Banca gave investors their first chance in several months to buy a new issue from a second tier Italian bank.

BPER Banca opened books for its inaugural sale of senior debt on Wednesday, giving investors their first chance to buy into a new issue from a second tier Italian bank during the Covid-19 pandemic.

Italy is launching a new retail product, the BTP Futura, turning to its impressive stock of domestic savings to help finance its recovery. It’s an excellent move, and could be even more valuable to Italy’s recovery from the ravages of the coronavirus pandemic than the external support of the European Stability Mechanism.