The World Bank and a syndicate of six Italian banks headed by Banca Commerciale Italiana signed an agreement today, July 12, covering a public issue in the Italian capital market. The syndicate members are Banca Commerciale Italiana, Credito Italiano, Banco di Roma, Banca Nazionale del Lavoro, Banco di Napoli and Banco di Sicilia.
The principal amount of the issue is Lit 25,000 million (approximately $43 million equivalent) bearing interest at the rate of 7% per annum with a final maturity of 15 years. The Bonds will be offered at a price of 98 1/2 of par. The issue will be repayable at par, exclusively by drawings, after a five-year grace period, in 10 annual installments on August 1 of each of the years 1978 to 1987; the schedule of repayments results in approximately equal annual payment of principal and interest. The Bonds will be callable on each August 1 of the years 1976 to 1986 at prices declining from 101 1/2% to par.
The Bonds will be listed on the Milan and Rome Stock Exchanges. The proceeds of the issue will be used in the general operations of the World Bank.
This is the second World Bank borrowing in Italy. In July 1961, Lit 15,000 million of 15-year bonds were offered publicly through a syndicate headed by the Banca d'Italia and including otherwise the same banks which are underwriting the present issue.