Primary Dealer Network

The role of the EU Primary Dealer Network

As part of the EU unified funding approach and in line with the established market practices, the Commission replies on a Primary Dealer Network to facilitate the efficient execution of auctions and syndicated transactions, support liquidity in the secondary markets, and ensure the placement of our debt with the widest possible investor base.

The Primary Dealer Network reinforces the Commission's capacity and ensures transparent relations with banks that support the placement of EU borrowing.

Members

As of 12^th July 2024, the EU primary dealers are (in alphabetical order):

1. Banca Monte dei Paschi di Siena S.p.A.
2. Banco Bilbao Vizcaya Argentaria S.A.
3. Banco Santander S.A.
4. Barclays Bank Ireland Plc
5. BNP Paribas S.A.
6. BofA Securities Europe S.A.
7. Bred Banque Populaire
8. CaixaBank S.A.
9. Cecabank S.A.
10. Citigroup Global Markets Europe AG
11. Commerzbank AG
12. Credit Agricole Corporate and Investment Bank S.A.
13. Danske Bank A/S
14. Deutsche Bank AG
15. DZ Bank AG Deutsche Zentral-Genossenschaftsbank
16. Erste Group Bank AG
17. Eurobank S.A.
18. Goldman Sachs Bank Europe SE
19. HSBC Continental Europe S.A.
20. Intesa Sanpaolo S.p.A.
21. J.P. Morgan SE
22. KBC Bank N.V.
23. Landesbank Baden-Württemberg
24. Morgan Stanley Europe SE
25. National Bank of Greece S.A.
26. Natixis S.A.
27. Natwest Markets N.V.
28. Nomura Financial Products Europe GmbH
29. Nordea Bank Abp
30. Piraeus Bank S.A.
31. Raiffeisen Bank International AG
32. Royal Bank of Canada Capital Markets (Europe) GmbH
33. Skandinaviska Enskilda Banken AB (SEB)
34. Societe Generale S.A.
35. TD Global Finance Unlimited Company
36. UBS Europe SE
37. UniCredit SpA

The application process to join the EU primary dealer network is open on an on-going basis. This will be updated accordingly, as per the procedure described below.

Criteria to join

The eligibility criteria to join the EU Primary Dealer Network are as follows:

• Being a legal entity established and having its head office in the Union or in a European Economic Area country;
• Being a credit institution authorised in the EU and supervised by an EU competent authority or an investment firm authorised in the EU to carry out the activity of underwriting of financial instruments and/or placing of financial instruments;
• Being a primary dealer for another European issuer.

The eligible credit institutions will have to commit to buy a minimum of 0.05 % of the volume to be auctioned.

The Commission will seek to work with banks active in supporting bond issuance and placements in order to successfully place its EU-Bonds and EU-Bills.

The Commission will select the banks for subsequent syndicated transactions from the members of the network based on a number of clearly defined criteria.

Application process

The application process to join the EU primary dealer network is open on an on-going basis and each application received will be reviewed within maximum 2 months after the receipt of the hard copy. Interested banks shall submit the complete application form and supporting documentation (see below) by email to EU-PRIMARY-DEALER-NETWORKec [dot] europa [dot] eu (EU-PRIMARY-DEALER-NETWORK[at]ec[dot]europa[dot]eu) and the original hard copy to the attention of:

Mr. Christian ENGELEN
Head of Unit at the European Commission, DG BUDG E.3 - Borrowing & Lending Operations
12, Rue Guillaume Kroll – L-2920 Luxembourg.

Any queries concerning the EU primary dealer network shall be addressed to EU-PRIMARY-DEALER-NETWORKec [dot] europa [dot] eu (EU-PRIMARY-DEALER-NETWORK[at]ec[dot]europa[dot]eu).

Application package for a membership

General terms and conditions

Valid as of 29^th November 2023

Previous general terms and conditions

Quoting arrangements

As from November 2023, the members of the EU Primary Dealer Network are incentivised to provide liquidity to EU bonds on recognised interdealer platforms. Via the firm quotes the EU Primary Dealers will provide on the platforms, they offer to buy and sell EU securities at pre-determined maximum fixed bid-offer spreads and minimum quantities. EU securities within the scope of this quoting mechanism are EU Bonds with a minimum remaining time to maturity of 1 year, issued, at least partially, under the EU’s diversified funding approach and with a minimum outstanding amount of EUR 3 bn.

Rules on the quoting arrangements are framed in Commission Decision (2023)/1602 on the primary dealer network (PDN) and the PDN General Terms and Conditions. While quoting is not compulsory to remain primary dealer for the EU, appropriate incentives have been introduced to ensure active engagement from a broad range of primary dealers in such quoting activities.

The introduction of quoting arrangements is a key milestone among a set of measures aiming at improving the secondary market liquidity of EU bonds and helping boost their liquidity and price transparency.

The list of EU debt securities eligible for quoting can be found in the third tab of the "EU debt securities data" table

Recognised interdealer platforms

As of 29^th September 2023, the recognised interdealer platforms for implementation of these quoting arrangements are:

1. MTS EU, a segment of the MTS Cash Domestic Market Multilateral Trading Facility, as operated by MTS S.p.A
2. BrokerTec EU Regulated Market, as operated by CME Amsterdam B.V

Reporting requirements

Primary Dealers that participate in the quoting arrangements will be required to report to the Commission on their quoting activities. The reporting, to be done either directly from the Primary Dealers or via a delegation to the trading platform, will include information on the bid and ask quantities, spreads and trading hours.

An example of the information to be submitted to the Commission can be found here.

Reported data should be submitted using a csv or excel format.

Queries on reporting for quoting activities can be addressed to EU-PRIMARY-DEALER-NETWORKec [dot] europa [dot] eu (EU-PRIMARY-DEALER-NETWORK[at]ec[dot]europa[dot]eu).

EU Repo Facility

The EU Repurchase Agreement (‘Repo’) Facility, available as of 7 October 2024, offers to EU Primary Dealers the opportunity to source certain EU- Bonds directly from the EU on a temporary basis.

The Repo Facility supports the capacity of EU Primary Dealers to post firm, public quotes on EU-Bonds. As a result, investors can be more confident about the terms on which they can trade EU-Bonds in the secondary market, thus improving the efficiency and fluidity of the EU-Bond market.

The EU will only execute repo operations using EU-Bonds that:

• Have a minimum remaining time to maturity of at least 1 year;
• Have a minimum outstanding amount of at least EUR 3 billion; and
• Were issued under the EU’s unified funding approach.

In practice, this means that the EU-Bonds eligible for repo transactions are the same as those for which Primary Dealers are encouraged to post quotes on electronic trading platforms under the quoting arrangements the EU launched in late 2023. 

The full list of EU debt securities eligible for repo operations can be found in the third tab of the "EU debt securities data" table.

Repo transactions will be executed on the Eurex Repo trading platform and cleared via Eurex Clearing AG, who will act as the Central Clearing Counterparty (CCP). Deutsche Bundesbank will represent the EU in its capacity as General Clearing Member (GCM). 

Full details on the functioning of the Repo Facility can be found in the relevant Factsheet here. 

Queries on Repo activities can be addressed to budg-EU-REPOec [dot] europa [dot] eu (EU-REPO[at]ec[dot]europa[dot]eu)

Documents

All legal documents linked to the EU borrowing and lending work, including linked to the Primary Dealer Network, are available in the documents' section of our website.