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Hungary to up subscribed capital of national railway co by Ft 112 bln

Hungary will raise the subscribed capital of loss-making state-run railway company MÁV by Ft 111.6 billion (€444.27 million) in 2007.

The capital increase will be carried out in two steps. The first instalment will be provided already in January, while the timing of the second one depends on business plans of MÁV Zrt. MÁV, which is expected to post losses of Ft 104 billion in 2006, saw its subscribed capital being slashed to Ft 78 billion in 2005 from Ft 208 billion, due to legal obligations.

Economics Minister János Kóka said in Parliament earlier that MÁV's loans outstanding could amount to Ft 356 billion by end-2006, Ft 277 billion of which is guaranteed by the state. According to the 2007 budget, MÁV wishes the state to gain state guarantee on Ft 40 billion worth of loans this year. (