EUR 1Bn Eurobond issue of the Republic of Hungary

In line with its financing plan for 2005 the Republic of Hungary launched and priced its second international bond on February 15, 2005. The €1 billion 15-year bond, priced at 23.3 basis points above the OAT 4 1% 2019, pays a fix coupon of 3 7/8 % p.a. The deal was lead managed by ABN AMRO and UBS Investment Bank.

The main characteristics of the transaction:

Amount: EUR 1 Billion
Tenor: 15 years
Maturity: February 24, 2020
Coupon: 3 7/8 % p.a.
Issue price: 99.152%
Spread: Apr 19 OAT + 23.3 bps (equalling to midswap + 12 bps)

The transaction attracted big demand especially from pension funds, insurance companies and fund managers, who had not bought Republic of Hungary bonds before. The significant oversubscription enabled the leads to price the bond on the tight end of the preliminary price guidance.

The proceeds will be used to re-finance public debt maturing in 2005.

Government Debt Management Agency Ltd. (ÁKK Rt.)

February 15, 2005

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