Italy draws record demand for new syndicated 15-yr BTP bond

ROME, Feb 3 (Reuters) - Italy raised 14 billion euros on Tuesday from its second syndicated bond sale of 2026, the country's highest ever demand for a single-tranche deal in a busy start to the year for euro zone issuers.

Final orders for the new 15-year BTP bond, due October 1, 2041, reached 157 billion euros ($185.12 billion), more than 11 times the deal's size, a lead manager said.

That beat the 133 billion euros in demand - ten times the size of the issuance - for another 15-year BTP a year ago.

Italian government bonds, which offer the highest yields of any euro zone country, are generally proving attractive to investors, given the political stability and falling budget deficit in the bloc's third-largest economy.

In its first syndicated issuance of 2026 Rome last month saw orders reach more than 13 times the 20 billion euros it raised with a dual-tranche BTP bond.

The new 15-year BTP will pay a yield of eight basis points (bps) over an outstanding October 2040 bond, down from around 10 bps initially, the lead said.

Italy's Treasury hired BBVA, BofA, Citibank, Deutsche Bank, Goldman Sachs and JP Morgan for the debt sale.

Maintaining firm investor interest is crucial for the Treasury, which manages the euro zone's second-largest debt pile as a percentage of gross domestic product (GDP).

The pricing of the deal is expected later on Tuesday.

($1 = 0.8481 euros)