On the eve of a massive bond-buying program by the European Central Bank, a true rarity appeared in the region’s corporate-debt market: bonds with no regular interest payments at all.

The two-year bonds, from French utility company GDF Suez, are the first of their kind since 2001 and much bigger than anything that has ever come before, underscoring the deep bond-market impact of the ECB’s plans. The central bank is expected to give investors more detail on how its EUR60 billion-a-month scheme will work on Thursday.

This is a perfect sign of just how substantial the spillover effect of the ECB’s asset purchase program is, said Jürgen Odenius, chief economist at Prudential Fixed Income, which looks after just over $540 billion in assets. [ECB President] Mario Draghi was unequivocal about the fact that the ECB will even buy bonds with a negative yield and that of course creates huge opportunities for companies to price at the sort of level that GDF did, he added, without saying whether he had bought the bonds.

In all, Paris-based GDF Suez sold four tranches of debt, with maturities ranging between two and 20 years, for a total value of EUR2.5 billion ($2.77 billion), according to bankers involved in the deal. For the EUR500 million two-year tranche, the coupon was fixed at 0%. The 20-year tranche of GDF Suez’s deal, meanwhile, offers a coupon of just 1.5%, which also represents a record low for a corporate bond in euros of that maturity. Investors placed orders worth a total of EUR6.5 billion for all of the debt on offer.

Investors are asking themselves, do you we want to keep our cash in negative deposit rates or do we want to put it in a corporate bond that is highly unlikely to default and slightly less punitive? said Andreas Michalitsianos, a fixed-income portfolio manager at JP Morgan Asset Management, which looks after around $1.7 trillion in assets, referring to the ECB’s deposit rate of minus 0.2%. Mr. Michalitsianos declined to say whether his firm had bought the bonds.

The financing arm of Italian car maker Fiat issued a much smaller EUR10 million bond with a 0% coupon in 2001 according to Dealogic. and German auto group BMW sold EUR150 million of zero-coupon bonds in euros in 1999. No company has ever issued a bond in euros greater than EUR160 million in size that offers a zero coupon.

Quantitative easing could see the ECB buy as much as EUR1 trillion worth of top-rated bonds in the eurozone, a prospect that already has aggressively driven down funding costs for companies and triggered a rush of issuance, including from firms beyond the region.

I don’t know if [the GDF Suez deal] marks the start of many more corporate bonds pricing with zero coupon but it shows that it’s certainly very achievable for other issuers, said Jeff Tannenbaum, head of the debt syndicate at Bank of America Merrill Lynch, one of the banks on the French deal. There is tremendous competition for assets at the moment and very high liquidity, which makes it possible for corporate to borrow, in some cases at record low levels.

Write to Josie Cox at josie.cox@wsj.com

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(END) Dow Jones Newswires

March 04, 2015 13:51 ET (18:51 GMT)