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Agence France Trésor today announces the launch of the OATI 2.10% 25 July 2023, linked to the French index of consumer prices (excluding tobacco).
After the completion on Tuesday evening of the order book open at midday, demand reached €6.4bn, of which €3bn was allocated.
The real yield at the time of the launch is 2.20%, 29 basis points over the real yield of the OATi 25 July 2017. The price has been set at 98.685. The settlement date is 20 February 2008 and the bond will be quoted on Euronext Paris.
Lead managers for this operation were ABN Amro/ RBS, BNP Paribas, Calyon et Natixis. Senior co-lead managers were Crédit Suisse, Deutsche Bank et Société Générale. All the primary dealers were part of the syndicate.
The allocation illustrates the diversity of the demand for French inflation-linked bonds: there is a strong demand to hedge exposure linked to regulated savings products or with income rates tied to regulated rates (39% of the allocation). OATi also provide an investment vehicle for pension funds (9%), insurers and asset managers (15%).
The geographical distribution reflects the strong demand in France, as well as the appetite from non-residents on French inflation linked bonds. More than half of the allocated orders are from France, the remaining coming from continental Europe (17.4%), the United Kingdom (13.5%) and the United States of America (8.3%).
This new index linked bond will be regularly auctioned, according to investors demand and in order to guarantee its liquidity.