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Foreign investors net sellers of Hungarian securities in Q4

Foreign investors held a total of HUF 8,650 billion or €32 billion worth securities issued by Hungarian entities - 38.2% of the total - at the end of 2009, the MNB said in its quarterly report on securities ownership structure on Tuesday. They sold net HUF 520 billion in Q4 but the market value of their holdings fell less than HUF 360 billion, thanks to price gains on shares. Their market share fell in the fourth quarter of 2009.

Foreign investors were net sellers in every segment of the Hungarian securities markets in Q4 2009, except for HUF 13 billion net secondary market purchases of Hungarian government bonds issued abroad, MNB figures reveal.

The largest foreign withdrawals were from Hungarian forint bonds, from two-week MNB bonds and from other bonds - bonds excluding government issues and mortgage backed bonds. They also sold, although to a far less extent, Hungarian listed shares, probably realizing price gains.

The market value of domestic investors' Hungarian securities holdings rose HUF 700 billion in the period as the market value of the total stock of Hungarian securities outstanding rose HUF 340 billion in Q4.

Foreign investors' Hungarian securities portfolio included HUF 4,140 billion market-value shares listed on the Budapest bourse, HUF 6,219 billion in government securities, including foreign issues, HUF 914 billion in mortgage-backed bonds and HUF 1,481 billion other bonds. Their other holdings, such as investment fund units and MNB bonds were relatively insignificant both in size or compared to the respective stocks.

Foreign investors sold net HUF 21 billion listed shares in the last quarter but price gains still raised the market value of their stock by HUF 152 billion in the period. Their market share slipped to 72.8% from 73.8%. Total market capitalization of the Budapest Stock Exchange rose HUF 276 billion in Q4 to HUF 5,685 billion at the end of 2009, practically all the rise in price gains.

Non-residents were net sellers of government securities to the tune of HUF 234 billion in Q4 but still held 43% of the total worth HUF 14,475 billion, including both domestic and foreign issues, at the end of last year. The total stock hardly changed in the quarter, and domestic banks and insurance companies took up the securities sold in the period.

The foreign holding of MNB two-week bonds fell a sharp 124 billion in the quarter to HUF 35 billion worth at the end of the year, and their market share fell from 4.9% at the end of September to just above 1%. The total stock dropped a slight HUF 92 billion in the three months to HUF 3,125 billion.

At the end of 2009, 41.2% of mortgage-backed bonds of Hungarian issuers were in foreign hands as against 48% three months earlier. Foreign investors sold HUF 20 billion worth, and the market value of their holdings fell HUF 24 billion in the last three months of 2009. The drop contrast with a HUF 268 billion increase in the total stock in the period, practically all reflecting new issues.

Excluding government and MNB securities as well as mortgage bonds, the foreign share in other bonds issued by Hungarian entities fell to 52.7% at the end of last year from 56.4% at the end of September as they sold net HUF 141 billion of these bonds. The market value of their stock fell slightly more, by HUF 150 billion. The overall stock fell HUF 78 billion in the quarter, to be worth HUF 1,481 billion at the end of 2009. (MTI-Econews)