Loans disbursed by the IMF and the European Commission, together with a small amount of development credit drawn down added €7.25 billion to Hungary’s international reserves in the Q4, the latest quarterly report by the National Bank of Hungary (MNB) shows. The reserves rose €6.631 billion in three months to €24.04 billion at the end of 2008.
Hungary called down the equivalent of €4.9 billion in the first tranche of a €12.3 billion stand-by loan from the IMF in November and the first €2 billion tranche of a €6.5 billion loan from the EU in December.
The IMF, the EU and the World Bank granted a combined €20 billion credit line to Hungary to support external financing after the global financial crisis hit the country in the autumn.
Deducting €144 million spent on debt service, debt management transactions of the Government Debt Management Agency (AKK) raised the reserves by €7.106 billion in the three months. Payments related to the MNB’s own debt servicing decreased them by €12 million. Yield on the reserves raised them by €314 million in the last quarter.
Factors decreasing the reserves in the quarter included a €25 million drop in the stock of short-term forex deposit placed with the central bank and a net €2 million outflow of transfers between Hungary and the European Commission.
The largest item reducing the reserves in the period were foreign currency payments by budget-funded institutions, totaling €275 million in Q4. The state of Hungary issued no foreign bonds in the quarter.
The MNB said it made no foreign currency conversions for the state on the market in Q4, similar to the previous two quarters. It is the bank’s policy to exchange part of the government’s net foreign exchange proceeds into forints on the market, but it last made such conversions, of €38 million, in the Q1 of 2008. (MTI-Econews)