Press release on the USD 1.5 billion bond issue of the Republic of Hungary

On January 27, 2005 the Republic of Hungary launched and priced its new USD 1,5 billion transaction. The size of the originally planned 500 million USD bond was increased to 1,5 billion USD due to large investor interest. The 10-year bond, priced at 57 basispoints above November 2014 US Treasury, pays a fix coupon of 4,75 % p.a.

Main characteristics:

Amount: USD 1,5 Billion
Tenor: 10 years
Maturity: February 3, 2015
Coupon: 4,75% p.a.
Issue price: 99,669%
Spread: November 2014 UST + 57 bps (equalling to USD mid swap + 19 bps)

The deal was lead managed by Deutsche Bank and Morgan Stanley.
The new transaction is an important step to widen investor base of the Republic in US and Asia. Due to the significantly oversubscribed book the bond was priced at the tighter end of the price guidance.

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

Budapest, January 27, 2005

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