Hungary's general government net financing requirement reached 1.1% of GDP in the second quarter and was 3.6% of GDP in the four quarters ending in Q2, the National Bank of Hungary said in a second reading of financial account data on Monday.
Excluding the effect of the main capital transfers resulting from opt-outs from private pension funds and an early repayment scheme for foreign currency-denominated loans, the general government net financing requirement reached 1.9% of GDP in Q2 and was 3.5% of GDP in the four quarters to Q2.
Gross state debt, according to the Maastricht definition, was HUF 22,168 billion or 77.7% of GDP at the end of Q2. The appreciation of the forint reduced the debt by HUF 252 billion and net borrowing increased it by HUF 25 billion, the NBH said. The ratio was down from 79.0% at the end of Q1 and 77.9% at the end of Q2 2011.
Central government net borrowing came to HUF 74 billion in Q2. A sharp rise in deposits was offset in part by a decline in long-term loans and equity assets, mainly mutual fund shares, the central bank said, explaining the increase in financial assets of the central government due to transactions, the NBH said. Financial assets were also lifted by the new withdrawals from private pension funds that translated as a HUF 56 billion capital transfer to the general government from households, it added. The NBH said the change in stock of financial liabilities due to transactions exceeded that of the change in financial assets. Liabilities related to government bonds and taxes were the main contributing factors, it added.
Net borrowing of local governments came to HUF 21 billion. Social security funds were net lenders of HUF 19 billion. Households were net lenders to the tune of HUF 292 billion or 4.1% of GDP in Q2. Household net lending came to HUF 1,492 billion or 5.2% of GDP in the four quarters to Q2. Non-financial companies were net lenders of HUF 387 billion or 5.5% of GDP in Q2. Their net lending came to HUF 709 billion or 2.5% of GDP in the four quarters to Q2.