Duration of 10 years, half-yearly coupons yet to be determined, loyalty reward for those who keep it until maturity equal to 1% of the capital. But it will increase until 3% depending on the annual growth rate of the Italian GDP. The Treasury has released the fact sheet on Btp Futura, the new government bond for retail with which “the various measures envisaged for income support and the protection of work, the strengthening of the national health system and the support for families and businesses Italian companies as well as the revitalization of the national economy “. It will be placed from Monday 6 July to Friday 10 July 2020 until 1 pm.
The stated goal is entice Italian families to invest part of their financial wealth in national debt. Reversing a trend whereby retail now only holds 4% of it. In addition, said the general manager of the Treasury Alessandro Rivera, “Will contribute to increasing the average life of the debt” by protecting against the “risk of refinancing“. With “a significant increase” in emissions due to Covid, so far a 302 billion for 2020 against the total 213 billion in the same period of 2019, also thanks to innovative issues such as the Btp Futura “we are managing to avoid that the higher volume has an impact on the debt structure and the refinancing conditions worsen”.
It is no coincidence that the Btp Futura will be promoted with one “emotional” advertising campaign which shows Italian excellence and ends with the slogan ‘Italy grows with you’.
From 6 to 10 July the first issue of the #BTPFutura, a government bond intended entirely to collect resources to finance the expenses due to the Covid-19 emergency and to support the recovery. It will be possible to subscribe to the bank, post office or via home banking pic.twitter.com/9auBkOoKcd
– Palazzo_Chigi (@Palazzo_Chigi) June 19, 2020
The series of guaranteed minimum coupon rates will be disclosed to the public on 3 July. The six-monthly nominal coupons will be calculated on the basis of fixed rates and increasing over time (the so-called step-up mechanism): a given fixed coupon rate for the first 4 years which increases a first time for the following 3 years and a second time for the last 3 years of the title’s life before expiry. The coupon rate of the first 4 years will remain unchanged, while based on market conditions they can be revised upwards only rates after the first.
The title will be placed at par (price 100) on the market through Borsa Italiana’s Mot electronic platform through Banca Imi and Unicredit, without commissions for those who sign between 6 and 10 July. To subscribe, you can go to the bank or post offices, “but there is also the possibility to book the title so as to avoid physical displacement,” said Iacovoni. “Obviously there remains the possibility of home banking“. The question, starting from a minimum lot of 1,000 euros, will in fact be completely satisfied, except for the faculty of the Ministry to close the issue early. Any early closure cannot however take place before Wednesday 8 July, thus guaranteeing the saver at least three whole days of placement.
The usual will continue to apply on performance subsidized taxation on government bonds of 12.5% and exemption from inheritance taxes.