Greek bonds coming highly recommended
Major investment firms kicked off the new year with a barrage of positive recommendations for Greek bonds ahead of the country’s first market foray for 2024, expected soon, as well as the start of bond reissues planned by the Public Debt Management Agency.
JP Morgan, Societe Generale and Citigroup reiterate their vote of confidence in Greek bonds, estimating that this month the Greek state will carry out its first syndicated issue after regaining investment grade, with a new 10-year bond. The current week was the first opportunity for Greece to claim its presence among the “wave” of issuers in the first days of the year, when investment demand is high. However, with Italy’s double foray on Tuesday and the likes of Belgium and Germany also going ahead with releases on Tuesday and Wednesday, the PDMA has chosen to wait. Next week holds some chance for an issue, thought the more likely date is January 30.
According to banking sources, the size of the new 10-year bond will be at around 3-4 billion euros, as the state’s net financing needs in the first month of the year stand at €3 billion. Demand is expected to be strong due to the inclusion of Greek bonds in international indices, which will bring fresh interest from quality investors.
As already announced, Greece will issue up to €10 billion this year, not including a possible green bond. At the same time, PDMA has scheduled six reissues of securities for the first half of 2024, starting next week, January 17, and continuing on February 14, March 20, April 17, May 22 and June 19. The securities to be reissued and the auction amount will be announced a day before.
International analysts expect that Greece’s latest debut in the markets will be crowned with complete success, recommending placements in Greek bonds. Societe Generale advises investors to buy 10-year Greek paper, while it expects the PDMA to start its syndicated issuance program this month with a new 10-year bond of at least €3 billion euros. Then it expects the issuance of a new five-year bond in March or April for €2-3 billion, a new 15-year or 20-year bond of the same value in the fall, and anticipates the issuance of the first green Greek government bond this year.
For its part, JP Morgan expects a new Greek 10-year note in January and a five-year note in March.
