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ÁKK sells €1.45 bln of domestic eurobond by end of February

Sales of Hungary's retail eurobond, the first domestic euro-denominated government bond, reached €1.45 billion between its launch last November and the end of February, the Government Debt Management Agency (ÁKK) said on its website on Monday. ÁKK noted that it specifically aims at raising debt financing by domestic investors, and specifically, by retail investors this year. It also aims at shifting retail euro savings towards longer terms. ÁKK sold €309 million of the three-year Premium Euro Bond (PEMAK) by the end of 2012, sold an additional €1.037 billion in January and a further €104 million in February. Retail investors bought €38 million of the bonds, domestic instititions bought €48 million and foreign investors bought €18 million in February, ÁKK said. Retail investors hold 11.3% of the total stock of PEMAK bonds, domestic institutional investors hold 85.7% and foreign investors have a share of 3% of the total, the debt manager said. PEMAK bonds pay interest twice a year, and the interest is pegged to the European Union's harmonised consumer price index (HICP) of eurozone members. The premium is 2.5 percentage points over over eurozone HICP on the two series offered to date. Accordingly, the first series carries annual 5.1% interest for its first interest period ending on June 21, 2013, and the second series, launched in January, pays 4.7% annually for its first interest period ending on May 25.