OATs
OATs are fungible medium- and long-term Treasury bonds with maturities of 2 to 50 years.
OATs are the only form of medium-term and long-term State financing. OATs are fungible securities with maturities at issue of 2 to 50 years, usually issued by auction. The fungibility technique consists in associating new with existing issues. This enables the State to issue new bonds at a price in line with the latest market prices but identical in all other respects to the initial issue. As a result, the State avoids issuing too many bonds with different characteristics and ensures the liquidity of those already issued. In January 2017, AFT innovated by launching the first green OAT.
OATs have a par value of €1. The value of the accrued coupon is calculated on the basis of the exact number of days over the exact number of days (ACT/ACT). OAT maturity dates and coupon dates are the 1st, 24th or 25th of the month. OAT trades are settled by national and international central securities depositories.
OAT auctions
On the Friday preceding an auction, AFT announces the bonds to be auctioned on the following Thursday and the upper and lower limits of the total amount to be auctioned. Auctions of long-term OATs (maturities of eight and a half years or more in 2025) are held on the first Thursday of the month at 10.50am, while auctions of medium-term OATs (maturities of two to eight and a half years in 2025) are held on the third Thursday of the month at 10.50am. Bids of at least €1 million are expressed on the basis of price as a percentage of par value net of accrued interest to two decimal places. OAT auctions are settled at T+2, i.e. usually the Monday after the auction.
