Hungary’s Government Debt Management Agency (AKK) plans net forint issues of HUF 279bn in February-April, AKK’s latest three-month forint issue plan shows.
HUF 145bn of the net issues are planned to come from discount T-bills and HUF 134bn from bonds, and discount T-bill and bond auctions are planned under the usual schedule, with practically no change in the average volumes on offer.
Gross issues are planned at HUF 1,174bn in February-April and gross repayments, including no big bond expiry, but large early bond buybacks, at HUF 895bn in the period.
Bond issues, including the HUF 40bn of bonds to be issued at the four exchange auctions planned during the period, will total HUF 295bn, the same as were planned for January-March in the previous plan.
The outcome may vary, however, as AKK said in December it planned to be more flexible with bond auctions in 2012, and will fix the terms and volumes on offer on the basis of market signals. It already shortened the period between the auction invitation and the auction for 12-month T-bills and for bonds, announcing these auctions only three days instead of one week ahead.
There will be no big bond expiry in February-April, but planned early buybacks were raised further, to HUF 120bn at reverse six auctions in February-April from the HUF 100bn planned at the six buyback auctions in the previous, Q1 issue plan.
AKK will also offer floating-rate bonds parallel with 12-month discount T-bill auctions on February 16, on March 14 and on April 12.
It plans to auction the longest, 15-year fixed-rate bond twice during the three months, on February 23 and on April 19.
With regard to discount T-bills, AKK plans to offer a combined HUF 540bn of three-month discount T-bills, or an unchanged HUF 45bn per auction at the 12 auctions of these bills in the period.
Three-month discount T-bills issues are planned to exceed the HUF 500bn expiries by HUF 40bn in February-April.
The per auction offer at the biweekly twelve-month discount T-bill auctions comes to HUF 45bn. AKK raised its offer from HUF 40bn to HUF 50bn at the last auction of the bills on January 5, but sold only HUF 35bn because of undersubscription and high yields. AKK plans to sell a total HUF 315bn of the twelve-month bills at the seven auctions due in the period against one big expiry, of HUF 210bn, on March 7.
The tentative target for twelve-month interest-bearing T-bill sales is HUF 24.5bn in Q1. As usual, the sales target of these bills, designed for retail investors, matches the expiring volume.
The debt manager projects the 2012 central government net financing requirement at HUF 674bn, and puts next year’s net issues - the 95% of it in forints - at HUF 643bn in this year’s issue plan revealed in December. The net issue target is about HUF 100bn less than the estimated HUF 746bn in 2011.