ÁKK exchanges HUF 28 bln of bonds at switch auction, below plan

Debt

The Government Debt Management Agency (ÁKK) sold HUF 28 bln of bonds maturing in 2024 and 2025 for ones that expire in 2017 and 2018 at a switch auction today, HUF 2 bln less than the plan, according to Hungarian news agency MTI.

ÁKK sold the announced HUF 15 bln of the floating-rate 2019/D bonds accepting 2017/C bonds as payment. It was the first time in two years that the debt manager offered a floater at a switch auction. 

ÁKK sold HUF 13 bln of 2025/B bonds for 2018/B bonds at the auction, HUF 2 bln less than planned.

Primary dealers bid to buy HUF 45.2 bln of the floaters expiring in 2019 and HUF 32.9 bln for the 2025/B exchange.

The 2019 bonds sold at an average price of 97.900% at the exchange and the 2025/B bonds sold at an average yield of 3.22%, the latter up by a sharp 49 bps from the same exchange on April 20.

Of the closest secondary market benchmarks, the five-year benchmark, calculated on 2021/B bonds, was 2.43% and the ten-year benchmark, calculated on 2027/A bonds, was 3.40% on Tuesday.

ÁKK calculated the 2017/C bonds which expire on December 20, 2017 at a net price of 99.6173% as payment. It took 2018/B bonds expiring on January 15, 2018 at a yield of 1.26%.

The twelve-month secondary market yield was 0.93% on Tuesday. 

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