As we reported yesterday, Austria was set to make Eurozone history with the first sale of a 100 year bond direct to public markets, bypassing private syndication. It did that later in the day, when the 3.5 billion offering priced tighter than initially marketed, at RAGB 2/2047 +50, at a price 99.502 to yield a paltry 2.112% and with a negligible 2.1% cash coupon.
What is even more notable is that despite mounting fears of an imminent tapering by the ECB which many have predicted will lead to a new European bond tantrum and blow out in yields, there was tremendous end demand by investors for the offering managed by BofAML, Erste Group, GS (B&D), NatWest and SocGen, mostly fund managers from across the globe, resulting in what ended up being more than 11BN in 208 different bids for the paper, an oversubscription of more than 3x! The breakdown for the final allocation is was follows, courtesy of Bloomberg:
3.5b 100Y tranche: Book exceeded 10.8b from 208 investors, including 1.5b of JLM interest
Allocation by geography:
Eurozone incl. Austria 29% Germany 13% France 4% Spain 3% Other Eurozone 9% Other Europe (non-Eurozone) 55% U. K. 42% Switzerland 9% Americas 12% Middle East 4%
This post was published at Zero Hedge on Sep 13, 2017.
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