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Moody's sees slow down in Italian corporate bond issuance by 2019

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Moody's sees slow down in Italian corporate bond issuance by 2019

Italian corporate bond issuance will return to normal levels by 2019 after issuance hit a record high of €42.5 billion in 2017, Moody's said.

Corporate bond issuance should return to €22 billion by 2019, with large, repeat issuers continuing to dominate the Italian bond market.

"Bond issuance will fall back to more normal levels because many large Italian companies have already refinanced to take advantage of cheaper rates," Paolo Leschiutta, senior vice president at Moody's, said.

The rating agency expects green bonds to extend its growth after volumes more than doubled in 2017. Of about $6 billion of green bonds issued in Italy since 2014, $4.8 billion was issued between 2017 and the first quarter of 2018, the majority of which was issued by Italian nonfinancial corporates.

Bank loans will remain the main source of financing, said Moody's, which projected continued growth in mini bonds of less than €50 million.

"M&A activity will continue to buoy issuance levels in 2018 but to what extent remains difficult to predict," Leschiutta said.