IGTA Journal - Summer 2020

explained Emmanuel Arabian, the vice-president of finance and treasury in the Lettre du trésorier of March 2017. In any case, commercial paper now represents 5% of the market debt of non-financial companies in the euro zone, or 0.8% of total outstanding debt, according to the European Central Bank (ECB). But for large companies familiar with market financing, the share of short-term securities in total debt may be significantly higher. NEU CP, Euro CP, US CP Issuers have the possibility of soliciting multiple markets. There are two blocks, the United States and Europe, each with outstanding amounts exceeding 1,000 billion (in euros or dollars) if all categories of issuers are taken into account. As regards securities issued by non- financial companies, the outstanding amounts are EUR 65 billion for the NEU CP (a largely French and Belgian market for the time being with 123 issuers), approximately EUR 100 billion for the Euro CP (no public data are available) and USD 310 billion, including USD 73 billion issued by non-US companies, for the US CP. Two main markets in Europe In Europe, where the commercial paper market developed mainly from the 1980s onwards - partly due to the rigidity of the system of remuneration of bank deposits - we are now dealing with two large masses: a hundred billion euros of Euro CP, 65 billion euros of NEU CP with 123 issuers as regards securities issued by non-financial companies. The Euro CP (ECP) is generally the form chosen by issuers outside France, a country in which there is, however, a major player, the Central Agency for Social Security Organisations (Acoss). The ECP market is, by far, its main source of funding (Acoss is statutorily required to provide funding with a maturity of less than one year). In 2017, 87 billion euros were issued (73% of its funding) with the following intermediaries: Bank of America, Barclays, Crédit Agricole, Crédit Suisse, Royal Bank of Scotland, UBS (arranger) and Bred Bank. The programme has a ceiling of 40 billion euros. Danish brewer Carlsberg has set up an ECP programme in 2019 capped at €750 million, rated F1 by Fitch, P-2 by Moody's, and issues (mainly within six months) through BNP Paribas, Citi, Danske Bank, Nordea and Société Générale. The electricity group Enel stands out with a 6 billion programme, modified in May, called the “Affordable and Clean Energy Target Guaranteed Euro CP Programme” (with the extra- financial rating agency Vigeo Eiris for an independent opinion) linked to the commitment to achieve, by 31 December 2022, that 60% of the electricity produced should come from renewable sources. In September 2019, the Italian company issued the first bond (in dollars, five-year maturity) whose coupon may be increased if the objective of greening energy production is not achieved. IGTA eJournal | Summer 2020 | 12