The European Commission (EC) launched its first investor survey this week to gauge opinion on its borrowing activities and status as an issuer.
The survey, which can be seen here, has been put together by the EU with the assistance of BofA Securities, Credit Agricole CIB, and HSBC. The EC noted: “The survey – which is a standard practice by large issuers – aims to gather information from the global investor community with the goal of identifying and addressing questions on the European Commission’s borrowing activities and its status as an issuer.”
It added: “In particular, the survey will allow the Commission to collect investors’ views on the most effective path to further enhance the liquidity of EU-Bonds and to allow them to trade and price in ways similar to European Government Bonds.”
The survey’s launch comes as the EC confirmed it had successfully completed its seventh EU-Bonds transaction for this year, raising €7bn. It added €3bn was raised as a tap of the seven-year bond due on 4 December 2029 and €4bn as a tap of the 20-year bond due on 4 November 2042.
Boosting secondary market liquidity
The proceeds of this transaction will be used for the NextGenerationEU recovery programme and the Macro-Financial Assistance+ programme for Ukraine, in line with the EC’s approach of issuing single branded ‘EU-Bonds rather than separately labelled bonds for individual programmes. The use of single-branded EU-bonds is one of the EC’s steps to boost secondary market liquidity of its securities. The transaction, it addde, completed 88% of its €80bn funding target for the first half of 2023. Further EU-Bonds auctions are planned for 12 and 26 June 2023.
“Two years after the start of large-scale borrowing via a sovereign-style funding strategy, today’s transaction shows the continuous strong support by our investors,” said Johannes Hahn, European Commissioner for Budget and Administration. “We will launch an investor survey swiftly, which will help us to serve our investors even better and to improve our funding strategy and market approach further.”
The EC said the data collected from the survey would be analysed in an anonymised way and not be disclosed publicly. It added it intended to publish a summary of responses received.