In the interest of placing corporate fund raising on multiple pillars and increasing the liquidity of the corporate bond market, on 1 July 2019, the Central Bank of Hungary (MNB) launched the Bond Funding for Growth Scheme. Issuing bonds may represent an alternative to bank financing primarily for larger corporations.
Our company has also been using several forms of financing in the past, but bond issuance raised our interest. Therefore, in early August 2019, we applied for the programme via the online registration interface of MNB. The conditions of participation include a credit rating of at least B+ given by a credit rating agency registered and supervised by the European Securities and Markets Authority (ESMA) and accepted by MNB for the valuation of collaterals. The ratings procedure started in November 2019 conducted by Scope Ratings GmbH. In conclusion of the procedure, on 25 February, the credit rating agency published its report, according to which our company was found eligible for participation in the bond funding programme.
The legal preparation of the bond issuance, investor negotiations, and the drafting of the documentation is currently under way, in which our staff is assisted by an external investment consultant and law firm. The bond issuance will take place in the framework of a private placement bond auction with an order book, with the participation of invited investors on 13 May 2020.
