€ 6.6 billion issued in new 7-year Dutch State Loan

Today, 11 October 2017, the DSTA launched a new 7-year Dutch State Loan (DSL) via a Dutch Direct Auction (DDA). The bond has a 0% coupon and will mature on 15 January 2024.

The auction started at 10:00 CEST with an initial spread guidance of +10.5 to +13.5 basis points over the German reference bond, the DBR 1.75% 15 February 2024. Bids came in quickly from the start. After about 10 minutes, the book was already larger than € 5 billion. In just over half an hour the book reached a volume in excess of € 12 billion. 15 minutes later the spread guidance was narrowed to +12 to +13 basis points.

The book closed at 11:40 CEST with a total bid volume of more than € 17 billion. An amount of € 6,572,277,000 was allocated at a uniform cut-off spread of +12 basis points over the reference bond. The issuance price was set at € 99.69, which corresponds to an issuance yield of 0.05%.

The allocated amount went to a wide variety of investors, as shown in the tables below. In total 55% went to ‘real money’ accounts and 45% to ‘other’ accounts. At the cut-off spread 100% of the bids from ‘real money’ accounts were allocated and 30% of the bids from ‘other’ accounts.

The bond will be reopened several times to reach an outstanding amount of at least € 15 billion within one year after the DDA. Liquidity will be guaranteed through a repo facility available to Primary Dealers.

Allocation:

Investor type distribution*

 

‘Real money', of which:

55%

Asset and fund managers

23%

Treasuries and ALM accounts of Banks

17%

Central banks, agencies and supranationals

10%

Pension funds and insurance companies

5%

‘Other', of which:

45%

Banks and trusts

27%

Hedge funds

14%

Other trading desks

5%

*The category ’Asset and fund managers’ also includes ‘private banks’;
total does not add up to 100% due to rounding 

 

Geopraphical distribution   

 

United Kingdom

40%

Netherlands

14%

United States

12%

Finland

7%

France

6%

Other

22%