Hungary's general government had net financing requirement of HUF 357bn or 5.1% of the period's GDP in the second quarter of 2011, the National Bank of Hungary (MNB) said in a second reading based on financial accounts data on Monday.
General government consolidated gross debt at nominal value amounted to HUF 21,286bn or 76.8% of GDP at the end of the period, unchanged from the preliminary figure reported on August 16. Gross debt fell in Q2 mainly because of the withdrawal of government securities that were part of pension fund assets transferred to the state.
The Q2 net financing requirement was up from a preliminary HUF 336bn or 4.8% of GDP net financing requirement published on August 16. The figure was sharply down from HUF 560bn or 8.4% recorded in Q2 2010.
The seasonally-adjusted net financing requirement fell even more sharply, to 2.8% of GDP in Q2 from 6.2% in the same period a year earlier, and was the lowest adjusted government financing requirement ratio since 2.3% measured in Q3 2008.
This year's first quarter was an exception as the booking of the transfer of private pension fund assets of former members to the state resulted in a net government financing capacity of 36.2% of GDP in the quarter, unadjusted, and a seasonally-adjusted 34.9%. Excluding the big one-off transfer, Hungary's government had net financing requirement of 6.3% of GDP and seasonally-adjusted financing requirement of 3.6% of GDP in Q1.
The private pension fund assets transfer was also a factor in the government net financing capacity of HUF 1,571bn, or 5.7% of GDP, in the four quarters to Q2 2011.
Hungarian members of private pension funds had until the end of January to opt out of a move, along with their assets, back to the state pension pillar. About 97% of members returned to the state pillar.