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Hungary could renew part of FX debt to support MNB plan

MNB

Hungary's state debt management agency ÁKK could support central bank plans to help the economy by renewing some of its expiring foreign currency debt in forint-denominated bonds, ÁKK deputy László András Borbély said in an interview with Reuters on Wednesday. Borbély said that ÁKK was in talks with the central bank and was ready to back the plan. The National Bank of Hungary (MNB) last week announced a funding for growth scheme which includes a combined HUF 500 billion in zero-interest central bank refinancing to support banks' cheap loans to SMEs and a HUF 1,000 billion reduction in Hungary's short-term external debt. Short-term external debt could be reduced partly by financing part of government foreign exchange expiries ahead from forints and part of it by cutting commercial banks' short-term external debt, the MNB said a week earlier. ÁKK has around 1 billion euros worth of expiring foreign currency debt to finance this year after a US dollar bond sale worth about €2.4 billion-2.5 billion in February and euro bond sales on the domestic market, part of which could come from additional forint-denominated bond sales.

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