Mihály Varga: Investors’ confidence in the Hungarian economy is unbroken
Hungary has successfully issued bonds: the Hungarian state has issued 575 million euros of low-interest bonds in the Japanese market with maturities of 3, 5, 7 and 10 years, Minister of Finance Mihály Varga explained on his community page.
Mihály Varga stated that the majority of the bonds are green bonds, ie we use our resources for environmental and climate protection sustainability purposes. Adding that
this was not always the case. In 2008, the left-wing government was unable to pay its maturing debts, the market refused to turn to Hungary, and eventually had to turn to the IMF.
The Minister of Finance explained that even today, the crisis is able to attract long-term market resources, consistent with the credible economic policies of recent years. Gaining confidence through effective debt management: the maturity of debt has improved from 4 to 6 years, its structure has become more favorable, and its financing has become more secure.
While in 2010 more than half of the debt was in foreign currency, today the ratio has improved to below 25 per cent and the share of non-residents has fallen from 6 per cent to 30 per cent.
– Mihály Varga closed his post.
The State Administration Center (ÁKK) said that Hungary had issued Samurai bonds denominated in Japanese yen on Friday. The transaction will bring funds of 75.3 billion yen to the market with the launch of four series with different maturities.
Out of the four series, the three longer-term 5-, 7- and 10-year green bonds, with which Hungary further broadened and deepened its relations with Japanese green investors. The shortest three-year traditional bond will share 16 billion yen in the package.
The main organizers of the bond issue were Daiwa Securities Co. Ltd., Mizuho Securities Co. Ltd. and Nomura Securities Co. Ltd., the GDMA added.
The successful transaction resulted in a more favorable pricing for the latest Samurai bond in September 2020 for all maturities, and nearly tripled the amount of green bonds subscribed by investors to 59.3 billion yen.
The amount received from the traditional series will be used by ÁKK Zrt. For general financing purposes. The proceeds from the green series will be used to support and refinance the green expenditures of the central budget in line with the Green Bond Framework Program.