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City of Kaposvár to take out Ft 786 mln loan from OTP

OTP Bank Rt has won a tender to provide a Ft 786 million loan to the City of Kaposvár, southwest Hungary, Kaposvár local council sources told Econews. The 20-year loan, which must be called by the end of 2006, and has a three-year grace period, is made up of two parts. A Ft 179.1 billion loan financing environmental developments carries a rate of 0.73% over the three-month EURIBOR. The rate on the remaining Ft 607.3 billion is three-month EURIBOR plus 1.33%. Both loans are provided as part of a preferential-rate municipality infrastructure development loan program run and refinanced by the Hungarian Development Bank (MFB) Rt. The city will use the loan for investments as well as operating expenditures. This year, Kaposvár plans some Ft 2.4 billion in investments, including road and bridge reconstruction, the renovation of old Socialist-era housing estates and the modernization of its district heating system.