Economy 11 January 2023, 4:08pm

Hungary buys back USD 1 bn notes

Portfolio

According to indicative results of a tender held last week, Hungary is to buy back USD 380 billion notes due November 2023 and USD 620 billion notes due March 2024, Reuters reported on Wednesday. This way the buyback of USD 1 bn worth of dollar bonds previously targeted for this year by the Government Debt Management Agency's (ÁKK) could be met. The issuer raised USD 4.25 bn of fresh funds last week.

Last week, Hungary issued a total of $4.25 billion worth of dollar-denominated benchmark bonds on three maturities, raising USD 1.5 bn in the 5-yr, USD 1.5 bn in the 10-year and USD 1.25 bn in the 30-yr segment.

In parallel with the issue, the debt manager also launched a buyback tender for Nov23 and March24 maturities. Investors had five working days to offer their bonds and the preliminary results of the tender have been published on Wednesday.

According to a report by Reuters, Hungary announced today a non-binding indication of the level at which it expects to set each Series Acceptance Amount and Clearing Spread for the November 2023 Notes and the March 2024 Notes for the purposes of its invitations to eligible holders of its outstanding:

(a) $ 2 billion 5.750% Notes due 2023 (of which USD 1.15 bn is outstanding), of which the ÁKK would buy back USD 380.3 bn; and
(b) $ 2 bn 5.375% Notes due 2024 (of which USD 1.64 bn is outstanding), of which the ÁKK would buy back USD 619.7 bn.

This means that the two together will meet the one billion dollar buy-back target in this year's financing plan.