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ÁKK sells HUF 27 bln of bonds at switch auction, below plan

Debt

The Government Debt Management Agency (ÁKK) sold a combined HUF 27 bln of bonds maturing in 2024 and 2025 for bonds expiring in 2019 at a switch auction on Wednesday, Hungarian news agency MTI reported.

The ÁKK sold HUF 7 bln of 2024/B bonds, accepting 2019/A bonds as payment. The ÁKK also sold HUF 20 bln of 2025/B bonds for 2019/C bonds. 

The scale of the sales was under the original plan, as the ÁKK had offered to sell HUF 20 bln of bonds in both cases.

Demand by primary dealers for the 2024/B bonds came to HUF 23.05 bln. Demand for the 2025/B bonds was HUF 29.44 bln.

The 2024 bonds sold at an average yield of 2.84% at the exchange, while the 2025 bondsʼ average yield came to 3.09% at the switch auction. The average yield of the 2019/A bonds was 0.29%, and the yield of the 2019/C bonds was 0.48%.

Of the closest secondary market benchmarks, the ten-year benchmark calculated on 2027/A bonds was 3.26%, the five-year benchmark calculated on 2022/B bonds was 2.10%, and the three-year benchmark calculated on 2020/C bonds was 1.09%.

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