(Reuters) -The European Union raised 20 billion euros ($24.25 billion) with the first bond backing its pandemic recovery fund and drew near-record demand, two lead managers said, as investors snapped up debt that is expected to offer both safety and liquidity as the EU becomes a leading debt issuer. The 10-year bond is the first of up to 800 billion euros of issuance by the EU to finance the fund, which marks an unprecedented act of European fiscal solidarity. Issuance until end-2026 will back grants and loans to member states to help their economies recover from the COVID-19 crisis. The deal is one of the biggest single-tranche debt sales on record, according to Refinitiv, well above earlier indications of around 10 billion euros. The EU had already issued 90 billion euros of debt since last October to back its employment support programme SURE. But the scale of the new programme, which the 27-country EU is managing similarly to a government issuer, has the potential to transform it into the world’s biggest supranational borrower, selling debt at a pace similar to Germany and Spain, according to JP Morgan. Tuesday’s deal shows continued interest from investors keen to buy scarce triple-A rated debt whilst gaining a yield pick-up over Europe’s benchmark issuer Germany. Final investor demand came in at 142 billion euros according to the lead managers, just short of the record 145 billion euros of demand the EU received for the 10 billion euro, 10-year tranche of its first SURE bond sale last October. Matt Cairns, head of credit strategy at Rabobank, said it was “an outstanding result” considering how much issuance is still to come for the programme and signalled that investors welcomed and support the issuance. The new EU bond, due July 4 2031, was priced to yield 0.086%, according to the lead managers. It rallied in the “grey” market pre-issuance, market participants said -- further evidence of strong demand. While all the debt backing SURE was issued as “social” bonds -- a type of ESG debt aimed at bringing designated “social” benefits -- Tuesday’s sale is a conventional bond. Some 30% of the recovery fund will be funded by green bonds -- which finance environmentally friendly expenditure -- once the bloc publishes its green bond framework, expected by September. The EU expects to issue another 80 billion euros of long-term debt this year. Like Tuesday’s deal, the EU will sell two more bonds directly to end-investors via bank syndicates by the end of July. Michael Leister, head of interest rate strategy at Commerzbank, said the deal “gives the EU a lot of leeway for the remainder of the year”. The bloc will add short-dated bills to its funding programme from September, to be placed at auction, the more common way governments raise debt. “As (liquidity) improves, investors are going to see this as an alternative to other safe bonds,” said Nick Sanders, a portfolio manager at AllianceBernstein, referring particularly to French government bonds, which have lower credit ratings. ($1 = 0.8249 euros) Reporting by Yoruk BahceliEditing by Rachel Armstrong and Catherine Evans Our Standards: The Thomson Reuters Trust Principles.