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ELLA Bank to issue bonds worth Ft 12 bln over next year

Hungarian commercial bank ELLA is to issue bonds worth a combined Ft 12 bln
within the next 12 months, the bank announced. The first issue of the series due on Tuesday – projected between Ft 1 bln - 1.5 bln -- is primarily targeted at institutional investors, managing director Kálmán Pomázi told Econews. The bonds will mature on December 1, 2008, and will carry 1% interest over the 3-month BUBOR. The bonds will be distributed by CIB Bank and will be later introduced to the Budapest Stock Exchange (BÉT). ELLA Első Lakáshitel Kereskedelmi Bank Rt's issue, a Collateralised Mortgage Obligation, is the first of its kind in Hungary. The bonds can be issued when the commercial bank already has a mortgage-covered loan portfolio. The funds thus generated then
can be reissued. ELLA Bank plans to issue several new mortgage-backed products in the future.
ELLA, which only caters to retail customers and small and medium-sized businesses, plans another issue of between Ft 1.5 bln-2 bln in the first quarter of 2006, projecting to issue the entire Ft 12 bln series by December next year.