MNB: Corporate bond market more than tripled since BGS launch

MNB

Image by Jessica Fejos

At the end of Q3, the non-financial corporate bond market rose in size to 4.4% of GDP, compared to the less than 1% at the launch of the Bond Funding for Growth Scheme (BGS) of the National Bank of Hungary (MNB) in 2019. Máté Lóga, director of the MNB's Strategic Directorate for Structured Financing, revealed the data in an interview with business daily Világgazdaság.

Lóga said 66 companies have successfully issued bonds, some of them several times, and the firms have secured around HUF 1.67 trillion in financing.

The MNB's Monetary Council launched the BGS in the summer of 2019 to beef up Hungary's relatively small corporate bond market. In August 2021, the council decided to raise the allocation for the program by HUF 400 billion to HUF 1.55 tln. Currently, around two-thirds of the BGS allocation has been used up, leaving room for further bond issues, Lóga said.

The last two years' experience shows that companies mostly use secured financing for investments and acquisitions, he added.

Besides the MNB, domestic banks, investment funds, and insurance firms are the most active buyers on the corporate bond market, Lóga said.

ADVERTISEMENT

PMI rises to 57 in June Analysis

PMI rises to 57 in June

Lawmakers postpone expanded data provision for tourism secto... Parliament

Lawmakers postpone expanded data provision for tourism secto...

Tihamér Tóth appointed European Court judge Appointments

Tihamér Tóth appointed European Court judge

FINA head thanks Hungary for hosting 2022 worlds City

FINA head thanks Hungary for hosting 2022 worlds

SUPPORT THE BUDAPEST BUSINESS JOURNAL

Producing journalism that is worthy of the name is a costly business. For 27 years, the publishers, editors and reporters of the Budapest Business Journal have striven to bring you business news that works, information that you can trust, that is factual, accurate and presented without fear or favor.
Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.