EU borrowing focuses on NextGenerationEU programme and support for Ukraine

Borrowing on international capital markets on behalf of the European Union, the European Commission is disbursing funds to Member States under various borrowing programmes. Its largest is the €800 billion “NextGenerationEU” programme, which seeks to support Europe’s recovery from the COVID-19 pandemic through investment in sustainability, digital solutions and resilience. To date around €142 billion has already been disbursed to EU countries.

The €18 billion “Macro-Financial Assistance+” (MFA+) programme is another key fund, providing stable and predictable support to Ukraine throughout 2023. In 2022, the European Commission – on behalf of the EU – disbursed €7.2 billion in emergency MFA loans to Ukraine, and, in January 2023, provided the first €3 billion under the MFA+ programme.

First 30-year transaction for 2023 achieves 10 times oversubscription

Seeking to raise further funds to finance these programmes, the European Commission asked NatWest to help with this, the first 30-year transaction for 2023, in the role of Joint Bookrunner. The mandate followed on from NatWest’s support with two dual tranche EU issuances last year. 

Investor demand soared right after books opened for the EU’s €5 billion tap of its 30-year bond due on 4 March 2053. The final order volume exceeded €51 billion, with more than 310 investors participating in the transaction. Fund managers represented the largest investor group accounting for 38% of the transaction, followed by bank treasuries with 26%. The bond attracted broad and diverse interest geographically, with UK investors taking 25% of the transaction, followed by investors in France (17%), Benelux (16%) and Germany (11%). 

The bond, which carries a 3% coupon, was the first syndication under the EU’s unified funding approach that the Commission introduced as its main funding method as of January 2023. Under this approach, the Commission – on behalf of the EU – is issuing single branded “EU-Bonds” rather than separately labelled bonds for individual programmes.

NatWest teams deliver for core issuers with One Bank approach

Johannes Hahn, Commissioner for Budget and Administration, commented: “Our first syndicated transaction of 2023 marks a strong and confident start to the new year of EU borrowing. The overwhelming demand for our bond demonstrates the scale and breadth of the investor base that the EU has cultivated for its borrowing activity. We will continue our strong presence in the markets in the coming weeks and months as we proceed with the execution of our issuance plan under our unified funding approach.”

Damien Carde, Managing Director, DCM at NatWest, said: “We’re delighted to have been able to support the EU again, and we’re proud to have been the only bank to act as Joint Lead Manager for this EU 30-year bond as well as the UK DMO’s £6 billion 30-year bond this week. Both issuances were the first real test for duration in the SSA market this year, with both deals marking the longest maturities issued in their respective currencies, year to date; investors’ demand has proven that there is strong appetite for long-dated bonds. Supporting these two core issuers is a prime example of multiple NatWest teams working together as One Bank to deliver the best outcome for our customers.”


This article has been prepared for information purposes only, does not constitute an analysis of all potentially material issues and is subject to change at any time without prior notice. NatWest Markets does not undertake to update you of such changes.  It is indicative only and is not binding. Other than as indicated, this article has been prepared on the basis of publicly available information believed to be reliable but no representation, warranty, undertaking or assurance of any kind, express or implied, is made as to the adequacy, accuracy, completeness or reasonableness of the information contained in this article, nor does NatWest Markets accept any obligation to any recipient to update or correct any information contained herein. Views expressed herein are not intended to be and should not be viewed as advice or as a personal recommendation. The views expressed herein may not be objective or independent of the interests of the authors or other NatWest Markets trading desks, who may be active participants in the markets, investments or strategies referred to in this article. NatWest Markets will not act and has not acted as your legal, tax, regulatory, accounting or investment adviser; nor does NatWest Markets owe any fiduciary duties to you in connection with this, and/or any related transaction and no reliance may be placed on NatWest Markets for investment advice or recommendations of any sort. You should make your own independent evaluation of the relevance and adequacy of the information contained in this article and any issues that are of concern to you.

This article does not constitute an offer to buy or sell, or a solicitation of an offer to buy or sell any investment, nor does it constitute an offer to provide any products or services that are capable of acceptance to form a contract. NatWest Markets and each of its respective affiliates accepts no liability whatsoever for any direct, indirect or consequential losses (in contract, tort or otherwise) arising from the use of this material or reliance on the information contained herein. However this shall not restrict, exclude or limit any duty or liability to any person under any applicable laws or regulations of any jurisdiction which may not be lawfully disclaimed.

NatWest Markets Plc. Incorporated and registered in Scotland No. 90312 with limited liability. Registered Office: 36 St Andrew Square, Edinburgh EH2 2YB. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and Prudential Regulation Authority. NatWest Markets N.V. is incorporated with limited liability in the Netherlands, authorised and regulated by De Nederlandsche Bank and the Autoriteit Financiële Markten. It has its seat at Amsterdam, the Netherlands, and is registered in the Commercial Register under number 33002587. Registered Office: Claude Debussylaan 94, Amsterdam, the Netherlands. Branch Reg No. in England BR001029. NatWest Markets Plc is, in certain jurisdictions, an authorised agent of NatWest Markets N.V. and NatWest Markets N.V. is, in certain jurisdictions, an authorised agent of NatWest Markets Plc. NatWest Markets Securities Japan Limited [Kanto Financial Bureau (Kin-sho) No. 202] is authorised and regulated by the Japan Financial Services Agency. Securities business in the United States is conducted through NatWest Markets Securities Inc., a FINRA registered broker-dealer (http://www.finra.org), a SIPC member (www.sipc.org) and a wholly owned indirect subsidiary of NatWest Markets Plc.

Copyright 2022 © NatWest Markets Plc. All rights reserved.

scroll to top