23 June 2020

UniCredit's innovative “basket bond” opens capital markets for SMEs in the Puglia region of Italy and will provide funding of up to €160 million

2:00 min

Last week, UniCredit closed the first tranche of the “Basket Bond Puglia”, a portfolio or “basket” of eight mini-bonds totalling €33.4 million. In the future, the bank will add more of these mini-bonds issued by smaller sized companies, taking the total nominal size up to €160 million. This includes cash collateral of up to €40 million provided by the Puglia Region as first loss guarantor.

To be able to maintain sustainable growth, SMEs need stable funding and liquidity to implement their strategic plans, even more so in the aftermath of the COVID-19 crisis. Funding diversification is key and access to capital markets an important step to scaling up financial stability and robustness.

While the size of SMEs can represent an obstacle, „basket bonds“ are an effective way to match investor requirements by grouping together several “mini-bonds.”

Andrea Casini, UniCredit Co-CEO Commercial Banking Italy commented; „The Basket Bond Puglia offers an opportunity for local companies to access capital market though alternatives to traditional banking. This helps them with their financing and supports investments, internationalisation, innovation and everyday working capital needs. Thanks to this innovative tool, which mobilises sizeable resources in favour of SMEs in Puglia, we can support local companies as they are get back on the path to growth.“

UniCredit acted as originator, arranger, and placement agent of the notes underwritten by institutional investors (Cassa Depositi e Prestiti and Mediocredito Centrale) on a private basis, while retaining 5% as per capital requirement regulation.