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SPAIN'S INSTITUTO Credito Oficial (ICO) highlighted the flight to quality and liquidity by most fixed income investors with the launch of a highly successful $500m floating rate note this week.
The five year deal, lead managed by HSBC Markets and Lehman Brothers, also marked the first time that ICO had issued with an explicit guarantee from Spain.
Until recently issues for ICO Spain's financial agency and development bank - had carried only a statutory guarantee from the Spanish state. ICO's guarantee is now direct, unconditional and irrevocable, and allows ICO to market its credit as pure Spanish risk.
The guarantee - and the zero risk weighting it carried with it in most European currencies,...