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Hungary offers 15-year gov’t bonds with 3- and 5-year ones at next Thursday's auction

The Government Debt Management Agency (ÁKK) will offer a combined HUF 45 billion in 3-, 5- and 15-year fixed rate bonds at an auction next Thursday, ÁKK said.

ÁKK replaced 10-year bonds in its regular mix with a new, 2028/A series bond which bear an annual coupon of 6.75% and will mature on October 22, 2028. ÁKK offered HUF 15 billion of the 10-year bond at the last auction on February 10.

The debt manager last offered 15-year bonds -- the 2023/A series -- on November 4, 2010 when it sold the announced HUF 10 billion bonds at an average yield of 7.03%.

The auction offer of the 2014/D benchmark bond is HUF 20 billion, and the offer is the usual HUF 15 billion of the 2017/B 5-year benchmark bond.

The 3-year secondary market benchmark yield was 6.96%, the 5-year benchmark was 7.17%, and the 15-year benchmark -- calculated on the five year shorter 2023/A bond -- was 7.43% on Thursday.

The three-year auction average yield was 6.96% and the five-year average was 7.22% at the last fixed-rate bond auction on February 10.

ÁKK sold the announced HUF 50 billion of 3-, 5- and 10-year bonds at the February 10 auction and sold an additional HUF 2.2 billion at the non-competitive tender after the auction. All three bonds were more than two-fold oversubscribed but auction still fell from two weeks earlier. Yields rose both compared to the previous auction and compared to Wednesday's secondary market yields.

ÁKK raised its combined offer of the three bonds to HUF 50 billion for the February 10 auction, after offering HUF 45 billion bonds at the bi-weekly fixed-rate auctions between the beginning of November and the end of January.