Concentration of gov’t security dealers falls in H1

Hungary’s five biggest primary securities dealers bought 64% of bonds offered at ÁKK auctions in H1 2008, down from 74% in H2 2007. Only primary dealers may buy bonds and discount T-bills at ÁKK auctions. The level of concentration also dropped in the case of discount T-bill auctions: the biggest five primary dealers bought 68% of bills in H1 2008, compared to 75% in H2 2007.

ÁKK sold Ft 830 billion of bonds, at nominal value, at auctions in H1 2008, 25% less than in H2 2007. During the same period, T-bill sales rose 6% to Ft 1,869 billion. The trends reflect an earlier announced change in ÁKK’s issue policy. After a lack of liquidity brought the securities market to a virtual halt in March, ÁKK decided to cut bond issues 25-30% from the original plan and raise its offering of T-bills.

Hungary’s biggest primary market bond dealer in H1 2008 was Citibank, followed by Raiffeisen Bank, OTP Bank, ING Bank and CIB Bank. In H2 2007, the list was very different: OTP Bank was at the top, followed by K&H Bank, ING, Erste and Deutsche Bank. There were eleven primary government securities dealers in Hungary in H1 2008, the same number as in H2 2007, though Raiffeisen Bank replaced Dresdner Bank. (MTI–Econews)