3 Issuing costs of state guaranteed bonds - Financial Risk and ...

A2.2.2 Comparison of means
Annex 2 Comparison of SG and non-SG bond populations
The comparison of means presented in Table 28 gives a sense of the characteristics of SG and non-SG bonds by country of risk. The nature of SG bonds is
fairly different to non-SG bonds in terms of the amounts issued. On average, the value of the SG bond issues were far larger than those of the issues of non-
SG bonds. Otherwise, however, these bonds were similar in terms of the coupon, maximum tenor and other contractual feature. Both of these findings are
to be expected to some extent. Contractual features are similar because the comparison group of bonds was selected explicitly on the basis of state
guarantee scheme eligibility criteria. And, differences in amounts issued reflect wholesale funding market conditions. 38
Table 28: Comparison of means, by country of risk
Amount issued Coupon Maximum tenor
(€m)
(%)
(yrs)
CDS spread Cross default Force majeure Negative pledge Private Grace period
(bps)
clause† clause† clause† placement† (days)
SG Non- SG Non- SG Non- SG Non- SG Non- SG Non- SG Non- SG Non- SG Non-
SG
SG
SG
SG
SG
SG
SG
SG
SG
AT 859.3 27.4 3 4 3.3 3.9 120 120 0.00 0.00 0.00 0.00 0.00 0.8 0.00 0.08 15 0
BE 1499 48 2 2 2.5 2.0 0 191 0.10 0.00 0.00 0.00 0.1 0.00 0.44 0.16 2 13
DE 392 58 2 3 3.3 2.7 261 135 0.00 0.00 0.00 0.002 0.00 0.00 0.004 0.002 2 19
DK 723 733 2 3 3.0 2.7 112 112 0.02 0.00 0.01 0.02 0.02 0.00 0.07 0.22 1 1
EL 1989 209 6 3 2.8 2.3 898 663 0.29 0.00 0.00 0.00 0.17 0.00 0.00 0.00 4 3
ES 352 496 3 4 3.3 3.1 378 282 0.00 0.00 0.01 0.01 0.00 0.00 0.11 0.06 0 0
LU 14 13 2 2 2.3 2.0 0 147 0.03 0.00 0.00 0.00 0.03 0.00 0.00 0.00 11 0
NL 1253 21 2 4 4.1 3.0 158 156 0.00 0.00 0.00 0.002 0.17 0.01 0.27 0.05 10 15
PT 813 153 3 3 3.0 3.0 559 564 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.46 7 0
SE 732 721 2 2 3.2 3.1 88 73 0.00 0.00 0.00 0.00 0.00 0.00 0.19 0.10 25 7
SI 510 37 3 5 4.0 5.0 0 0 0.04 0.00 0.00 0.00 0.06 0.00 0.00 0.00 3 0
UK 1129 40 2 1 2.7 2.7 157 96 0.00 0.00 0.00 0.00 0.00 0.01 0.23 0.10 7 1
Total 686 75 2 4 3.1 2.9 327 151 0.04 0.00 0.002 0.003 0.04 0.006 0.11 0.05 5 15
Source: Bloomberg
38 The validity of the econometric analysis is not undermined as a result of sizeable differences in the value of SG versus non-SG bonds because amounts issued are controlled for explicitly in the econometric analysis.
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