ÁKK buys back HUF 25.5 bln of bonds at reverse auction

Debt

The Government Debt Management Agency (ÁKK) bought back HUF 25.5 bln of three bonds before maturity at a reverse auction on Wednesday. The amount repurchased was down. Early repurchase yields fell further.

Combined demand for the three bonds totalled HUF 30.3 bln, dropping from the previous auction on October 1 where the debt manager accepted all the HUF 37.4 bln bids it received.

ÁKK accepted HUF 9.1 bln of the HUF 11.1 bln of bids submitted by primary dealers for the early redemption of 2015/A bonds which mature on February 12, 2015. Average yield was 1.29%, down from the 1.33% average at the previous repurchase auction.

ÁKK accepted HUF 11.8 bln of the HUF 13.8 bln of bids for early redemption of 2015/C bonds, which mature on August 24, 2015. Average yield fell to 1.40% from 1.45% two weeks earlier.

ÁKK accepted HUF 4.6 bln of the HUF 5.4 bln of bids for early redemption of 2016/C bonds which mature on February 12, 2016. This was the first early repurchase of 2016/C bonds.

The six-month and twelve-month secondary market benchmark yields were 1.50% and 1.58%, respectively, on Tuesday.

Including the current auction, ÁKK has repurchased a combined HUF 395 bln bonds ahead of maturity at this year's 13 reverse auctions. It bought back HUF 518 bln at 22 reverse auctions in the full year of 2013.

The debt manager started to invite reverse auctions this year only in April after it topped up State Treasury deposits. The deposits fell late last year as issues were reduced and buybacks were high to ensure the drop of Hungary's year-end state debt.

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