Translated version of this PSD: Hungarian
Project Description
Investment of up to HUF 25 billion (approx. EUR 80 million), in any case up to 20% of the size of each issuance, in series of HUF denominated covered bonds to be issued by Erste Jelzalogbank Zrt ("the Issuer") over a period of 3 years on the Hungarian capital market. For the first investment, the EBRD subscribed HUF 2 billion (approx. EUR 6.4 million) out of HUF 10 billion covered bonds issued with 3 year maturity under the Issuer's HUF 100 billion covered bond programme.
Project Objectives
The covered bond transaction will support the Issuer to access medium- to long-term funding outside Erste Group and to comply with the mortgage funding adequacy ratio introduced by the National Bank of Hungary with the objective to improve the maturity mismatch between HUFdenominated assets and liabilities in the banking sector.
Transition Impact
The Project will contribute to the resilience of the financial sector in Hungary by (i) revitalising the Hungarian covered bond market and (ii) supporting the NBH's initiative to strengthen banks' balance sheets through reduction of the asset - liability maturity mismatch in the banking sector, where long 2 term mortgage assets are predominantly funded by very short-term deposits and, additionally, (iii) improving the environment for mortgage funding.
Client Information
Erste Jelzalogbank Zrt Covered Bonds
Erste Jelzalogbank Zrt. is a mortgage bank established in June 2016 in Hungary. It is 100% owned by 100% owned by Erste Bank Hungary Zrt.
EBRD Finance Summary
HUF 25,000,000,000.00
Up to HUF 25 billion (approx. EUR 80 million)
Total Project Cost
HUF 100,000,000,000.00
up to HUF 100 billion (approx. EUR 320 million)
Environmental and Social Summary
Categorised FI (2014 ESP). While the Issuer is is a new client to the Bank, its parent Erste Bank Hungary and the Erste Bank Group are long standing clients who have a good record of implementing Projects in line with the EBRD's Environmental and Social (E&S) requirements. The tasks undertaken by the Issuer under this Project have negligible E&S impact and as per paragraph 7 of PR9, the Issuer will not be required to develop specific E&S risk management procedures. The Issuer will be required to meet PRs 2, 4 and 9 and submit Annual Environmental and Social Reports to the EBRD on the implementation of the PRs.
Technical Cooperation
None.
Implementation Summary
The project supported Erste Mortgage Bank, a newly established mortgage bank at the time, on its efforts to access capital markets via the successful issuance of covered bonds in order to build its medium- to long-term funding base that is in turn channelled to Erste Bank Hungary and/or any other partner bank. Ultimately, the project supported Erste Bank Hungary (and/or any other partner bank) to improve the asset and liability mismatch and to comply with the mortgage funding adequacy ratio as required by the National Bank of Hungary. To date, the Bank has invested HUF 2.2 billion in covered bonds issued by Erste Mortgage Bank.
Company Contact Information
Andras Gabor Botos
AndrasGabor.Botos@erstebank.hu
+36 1 373 2103
https://www.erstejelzalogbank.hu
Business opportunities
For business opportunities or procurement, contact the client company.
For state-sector projects, visit EBRD Procurement: Tel: +44 20 7338 6794
Email: procurement@ebrd.com
General enquiries
EBRD project enquiries not related to procurement:
Tel: +44 20 7338 7168
Email: projectenquiries@ebrd.com
Public Information Policy (PIP)
The PIP sets out how the EBRD discloses information and consults with its stakeholders so as to promote better awareness and understanding of its strategies, policies and operations. Please visit the Public Information Policy page below to find out how to request a Public Sector Board Report.
Text of the PIP
