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Diákhitel to offer Ft 7 bln of bonds

State-owned student loan provider Diákhitel Központ Rt (DK) announced on Friday it will offer Ft 7 billion of DK 2008/01 bonds at an auction on March 7. DK did not set a minimum or maximum price for the auction, which will be the fifth of the series. The minimum purchase of the bonds, which have a nominal value of Ft 10,000 apiece, will be Ft 1m. The state-guaranteed bonds carry a fixed rate of 6.5% and run until August 12, 2008. Interest payments are made yearly on August 12 and principal is paid in a lump sum upon maturity. DK reserves the right to raise or lower its offer by 34% and also reserves the right to cancel the sale in the event of significant market changes, such as a rise or fall of yields on government bonds of more than 50bp. At the last issue of the series, on January 3, DK received offers for Ft 22.5 billion of Ft 9 billion on offer, but sold only the announced amount. Average yield at the auction was 7.12%, 19bp over the three-year secondary market benchmark on the same day.