BUDAPEST, April 12 (Reuters) - Hungary's central bank is committed to buy green government bonds as part of its asset purchase programme, the bank said on Monday in a reply to Reuters questions about a 30-year green government bond issue planned for this month.
The new forint-denominated green bond will be offered at an auction on April 22, the debt agency said in a reply to Reuters questions on Monday. The agency said it planned to sell 90 billion forints ($300 million) worth of the bond in 2021.
The National Bank of Hungary, led by an ally of Prime Minister Viktor Orban, has injected huge sums into the pandemic-hit economy over the past year, including billions of euros worth of government bond purchases. This has supported the local bond market at a time of surging borrowing needs.
"The NBH is committed to buy green government bonds as part of its asset purchase programme under similar conditions to any other government bond," the central bank said.
"The NBH is prepared to purchase these instruments to the extent needed to facilitate stable market conditions," it added.
In order to meet this goal, the central bank said, it was prepared to increase its share to similar levels as in the case of other long-term government bonds.
The pace of its purchases would be flexible, the bank added, and it would closely monitor the market and demand for the new bond.
The European Central Bank also buys green bonds as part of its corporate sector purchase programme and holds roughly a fifth of eligible green assets, in line with the corporate bond universe, buying green bonds in proportion to the market. ($1 = 299.5900 forints) (Reporting by Krisztina Than; Additional reporting by Balazs Koranyi in Frankfurt; Editing by Clarence Fernandez)
