Cassa Depositi e Prestiti has completed its first issue of a digital bond using technology blockchain. The operation, from 25 million euro, was entirely underwritten by Understanding St. Paul, which acted as sole institutional investor. The bond has a duration of 4 months and provides a fixed annual coupon of 3,633%, which will be paid upon maturity.
The issuance was achieved using distributed ledger technology Distributed Ledger Technology (Dlt), and is the first of this type in Italy based on the "FinTech" decree law. This decree regulates the issue and circulation of financial instruments in digital format.
The blockchain and the markets: the ECB's experimentation
The operation fits into the experimentation started by European Central Bank, which aims to explore and test the use of blockchain technology in financial markets. As part of this initiative, Cdp and Intesa Sanpaolo played the role of Market Participant, with CDP also acting as Market DLT Operator. As Manager of the DLT Registry, CDP has been authorized by Consob to register in the list of Registry Managers for digital circulation.
The settlement of financial flows took place on the same day in Central Bank money, using the “Tips Hash Link” solution developed by the Bank of Italy. This solution enables interoperability between a generic DLT platform and the Target Services system, specifically T2, which is used by the Eurosystem for wholesale payments.
Comments
“This transaction represents a significant step for CDP in capital markets innovation, through the pioneering adoption of blockchain technology for bond issuance,” he said. Fabio Massoli, director of Administration, Finance, Control and Sustainability of Cdp -. It is a project perfected with the precious support of Intesa Sanpaolo and aims to establish a new technological model that can act as a precursor for the issuance of digital bonds in the context of the new legislative and regulatory framework. The promotion of a new market ecosystem and the implementation of an innovative, efficient and secure market infrastructure will provide added value to both issuers and investors, opening up new opportunities for other operators, including SMEs,” said Fabio Massoli, Director of Administration, Finance, Control and Sustainability of Cdp.
“We are particularly satisfied with being the first in Italy to have carried out, together with Cdp, an operation that aims to be the reference for future issuers in a totally new legislative and regulatory framework – he said Massimo Mocio, Deputy Chief and Head of Global Banking & Markets, Imi Cib Division of Intesa Sanpaolo -. We are also proud to take part in the experimentation program promoted by the ECB, demonstrating the digital skills present in our Group and the role that Intesa Sanpaolo is called to play on the markets, in support of businesses and financial institutions, also through new infrastructures technological".
