MADRID, June 12 (Reuters) - Spain raised 6 billion euros ($6.8 billion) in a 10-year bond syndication on Wednesday from mostly foreign investors who had poured in orders worth 27.5 billion euros, undeterred by a record low yield for such a placement.
The Treasury said in a statement that foreign investors accounted for 86% of the total placement "the highest mark in the last few years, demonstrating investor confidence in the strength of the Spanish economy".
The yield was just 0.629%. The Treasury set the final spread at 33 basis points over mid-swaps, taking advantage of a rally in peripheral debt which has seen Spanish 10-year government bond yields fall 100 basis points since the beginning of the year.
Spain last issued a 10-year bond via syndication in January this year, paying a yield of 1.462%.
Peripheral debt has rallied sharply this year as investors hunt for yield in a trend underpinned by expectations of accommodative monetary policy from both the European Central Bank and the U.S. Federal Reserve, which is keeping euro zone bond yields at all-time lows.
Buyers from Britain and Ireland represented the largest investor group, at just over 26%, while by investor types, fund managers led with a share of 47.2%, followed by bank treasuries on 20.9% and insurers and pension funds, on 13.5%. Central banks and official institutions accounted for 8.3%.
BBVA, Credit Agricole, Goldman Sachs, HSBC, Santander and Societe Generale arranged the deal.
The deal came on the same day as Italy received orders of over 23.5 billion euros for a surprise new 20-year bond. Demand for the Italian sale was strong even though the European Union is expected to take disciplinary action against Rome over the country's growing debt.
($1 = 0.8845 euros)
(Reporting By Andrei Khalip, editing by Joan Faus and Susan Fenton)
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