(Bloomberg) -- Hungary is tapping the market for foreign-currency bonds, sticking with its practice of securing most of its international financing early in the year, undeterred by the forint’s slide toward two-year lows.
The government is selling a €1.5 billion ($1.56 billion) euro-denominated note due in 2034, at 205 basis points above midswaps, tighter from the initial price talk around 240. It’s also issuing a green note due 2040, with pricing around midswaps plus 235 basis points, down from an initial 270, according to a person familiar with the matter who asked not to be identified.
The issues received orders above €5.6 billion and €4.4 billion, respectively.
The bond sale means Hungary’s debt agency is on track to sell all of the €2.5 billion in international securities it had penciled in according to this year’s financing plan. The agency appears keen to front-load debt sales early in January, just as it did in 2024 when it joined what eventually became a record-setting period for emerging debt issuance.
Neighboring Slovenia also came early to the market Tuesday, in the process of selling €1 billion in 30-year bonds at midswaps plus 128 basis points.
The foreign financing could be key for Hungary at a time when about €19 billion in European Union funds earmarked for the country has been frozen due to concerns over graft and the rule of law, and after €1 billion in EU aid was permanently lost last year.
The potential deals also coincide with the forint’s deepening weakness. The currency has slipped to a fresh two-year low against the euro, undermined by an economic recession and concerns of fiscal spending before next year’s election.
The bookrunners of the Hungarian bond sale are Citigroup Inc., Deutsche Bank AG, Erste Group Bank AG, ING Bank NV and Raiffeisen Bank International AG.
--With assistance from Jan Bratanic and Olga Voitova.
(Updates with final terms, orders in second and third paragraphs)
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