From Eurobonds to Lombard Bonds. While awaiting the decisions of the European Council on community bonds and the mes, Lombardy decides to do - on a small scale - on its own and announces the issue of a regional bond to finance an extraordinary three billion euro investment plan. Money that will be used to revive the economy of the Region most affected by the Coronavirus emergency with 66.971 infected and 12.376 deaths. The Region announced it through a note.
As explained by Pirellone investments will be made "in debt", using new bonds “depending on the convenience and the rate that the market will offer”.
We will have to wait for the details of the issue, but according to forecasts, the Lombard bonds "will be authorized on the basis of effective cash requirements", specified the institution led by Attilio Fontana.
It is not the first time that Lombardy has used bonds to finance its projects. It already happened in 2001, nineteen years ago, when, following the crisis caused by the attack on the Twin Towers on 11 September, the Region decided to launch an extraordinary plan for infrastructure aimed at financing the World Ski Championships, the purchase of rolling stock and tools to combat hydrogeological instability.
At the time, "although the program provided for 2 billion dollars in issues, the efficient management of cash flows made it possible to reduce the exposure to just one billion", underlines the Region which details how the issue went: " in the first months of 2002 they arrived more than 30% higher subscription requests compared to the bonds issued".
Fontana's hope is that the success of nineteen years ago will be repeated even today, allowing the Region to finance investments aimed at financing the battered Lombard economy. In 2020 “400 million will be allocated for the municipalities and provinces for interventions of public works”, explained Fontana during a live Facebook.
