Hungary issued a Green Panda Bond worth 2 billion yuan on the Chinese market on Wednesday, Finance Minister Mihály Varga announced on Facebook.
On Monday, Hungary issued a Green Euro Bond worth 1 billion euros. According to Varga, these bond issues show that Asian investors are also confident in the Hungarian economy.
Wednesday’s bond issue will ensure Hungary’s continued presence in one of the world’s largest capital markets and further strengthen cooperation with China,
the minister stressed, adding that by broadening the investor base, the financing of Hungarian public debt could have more legs to stand on, he added.
The annual fixed coupon of the three-year Panda Bond with a face value of 2 billion yuan is 3.75 percent, MTI reports. The main manager of the bond issue were the Bank of China Ltd, China Construction Bank Corporation, and Export-Import Bank of China.
The proceeds of the bond will be converted into euros by the Government Debt Management Agency (ÁKK) under a three year, fixed-rate foreign exchange swap in line with its debt management strategy, and the proceeds will be used to finance and refinance certain green expenditures of the budget. According to Varga’s post, this means that funds raised from the bond issue can be used to strengthen energy security and fight climate change.
Hungary became the first country in the world to issue 1 billion yuan worth of green panda bonds on the Chinese bond market a year ago, with demand doubling, Varga recalled.
Source of article/picture: Hungary Today