EuroZone rescue bonds make Strong debut, sell out in 15 minutes.
The EuroZone bail-out fund saw a strong demand for its 1st ever bond issue in a big vote of confidence for Europe coming at a Key time in the debt crisis.
More than €40B in orders were bid for the bonds from some of the biggest public and private funds around the World. Bankers could not recall such a large order book for any bond, government or corporate ever.
The demand enabled the European financial stability facility to easily allot the maximum amount of €5B of bonds it wanted to sell and price the bonds at much lower yields than a previous European Union deal earlier this month.
Demand was huge. I do not recall an order book of this size. It filled up in just 15 minutes, it was reported.
The rush for the bonds comes in spite of the EuroZone facing its gravest crisis since the launch of the single currency 12 yrs ago.
The bond priced at a yield of 2.8%, which is 6 basis points above mid-swaps, the European reference point for pricing debt, or 48 basis points over Bunds. This is lower than the previous EU bond, which priced at 12bp over mid-swaps and 70bp over bunds.-Paul A. Ebeling, Jnr. www.livetradingnews.com