Hungary to Withdraw from IMF Loan This Year

Hungary plans to withdraw from the remaining installments of a loan from the International Monetary Fund (IMF) scheduled for this year and instead focus on 2010, when it plans to issue bonds denominated in euro, according to an official in Budapest, quoted by Dow Jones agency.

On the other hand, Hungary would be able to access the first tranche scheduled for 2010 of the loan, said the general director of the agency’s executive management of public debt, Andras Laszlo Borbely.

The Hungarian financial market ground to a halt in October of last year due to the global credit crisis, so the government in Budapest made a funding arrangement with the IMF European Union (EU) worth around 20 billion euro.

The authorities have made use of loans to finance its debts in April, when the government began again to issue bonds, initially small amounts, which were gradually increased in July, Mediafax notes.

On Thursday, the Hungarian agency for the administration of public debt issued bonds denominated in forints worth 84.5 billion forints (about 300 million euro). On Friday the agency completed the first issue of bonds denominated in euro made since the onset of global crisis, amounting to one billion euro.