The Budapest Times

Hungary issues USD 4.25 billion of dollar bonds

Written by BT/MTI
Hungary issued 4.25 billion dollars of dollar bonds in a transaction that was four times oversubscribed, under favourable conditions, at a low interest rate and long,10- and 30-year maturities, Finance Minister Mihaly Varga said in a video posted on Facebook on Wednesday.

Varga said later in the day that Hungary also sold euro-denominated bonds worth one billion euros.

The Government Debt Management Agency (AKK) said Hungary sold 2.25 billion dollars worth of 10-year bonds with a 2.125 percent coupon and 2 billion dollars worth of 30-year bonds with a 3.125 percent coupon, at 100 basis points and 150 basis points over corresponding US Treasuries.

The issue was lead managed by BNP Paribas, Citi, Goldman Sachs Bank Europe SE and J.P. Morgan.

AKK on Monday said it modified its 2021 issue plan to make room for an additional 4.5 billion euros of FX bond issue to help cover a likely delay in European Union COVID recovery fund money, certain government expenditures in 2021 and for partial pre-financing of the 2022 budget deficit.

Regarding the timing of the bond issue Gergely Gulyas, the head of the Prime Minister’s Office, said on Wednesday at a weekly press briefing, that at the moment it is possible to borrow on favourable terms in the market due to the budgetary situation and economic growth in Hungary.

Gulyas said that the government requires funds to run its prefinancing system of distributing EU development grants but said that the favourable terms could also allow the refinancing of exiting loans with better conditions.

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