Hungary’s central bank eyes control of bourse, state company IPOs

By bne IntelliNews October 21, 2015

Hungary’s central bank wants to take control of the Budapest Stock Exchange (BSE) and list shares of state-owned companies on the bourse, Deputy Governor Laszlo Windisch suggested on October 21.

A deal could be good news for the BSE, which has endured a tough few years. It's few listings have proved far from successful listings, while it has seen a series of delistings, over the last few years. 

Turnover has also been steadily eroding. The average daily equity turnover on the bourse shrank 17.9% in 2014, to leave it at HUF7.8bn (€25.1mn). It is the lowest figure in the past nine years.

The Magyar Nemzeti Bank (MNB) currently owns a 6.9% stake in the stock exchange. Austria's CEE Stock Exchange Group controls a 50.5% stake and Oesterreichische Kontrollbank AG holds 18.3%. Last month, reports suggested the MNB is in talks with the Austrian owners in a bid to increase its stake.

The BSE can operate efficiently if the largest operators - issuers or investment service providers - take part in the management of the market as owners, Windisch told pro-government daily Magyar Idok. Several steps are needed to achieve that, he added.

The listing of state-owned companies and the launch of programmes aimed at helping smaller companies gain access to funding via the stock exchange are necessary, he said. Power company MVM, gambling firm Szerencsejatek, and MKB Bank have been mentioned as potential IPO candidates.

Until now, the poor relationship between the government and the bourse virtually ruled out the floatation of state-owned companies, analysts at Portfolio.hu suggest.

“In a best case scenario we should see more listed companies, increased interest by investors, higher turnover, and more analyst coverage”, they forecast. At the same time, negotiations on any deal would likely be difficult, the analysts add.

Related Articles

RBI doubles net profit y/y in Q1 as Russian business recovers

Raiffeisen Bank International (RBI), the second largest bank operating across Central and Eastern Europe by assets, reported that net profit almost doubled year-on-year to €220mn in the first ... more

World Bank forecasts a 0.4% y/y decline in Belarus's GDP for 2017

The Belarusian economy will decline by 0.4% year-on-year in 2017, followed by a modest growth of 0.7% in 2018 and 1.2% in 2019, the World Bank forecasts in its Belarus Economic Update published on ... more

EIB and Belarus sign Framework Cooperation Agreement

The European Investment Bank (EIB) and Belarus inked the Framework Agreement on Cooperation on May 15, which paves the way for the lender to invest up to €200mn in Belarusian projects, the Foreign ... more

Register here to continue reading this article and 2 more for free or purchase 12 months full website access including the bne Magazine for just $119/year.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

Thank you. Please complete your registration by confirming your email address.
A confirmation email has been sent to the email address you provided.

To continue viewing our content you need to complete the registration process.

Please look for an email that was sent to with the subject line "Confirmation bne IntelliNews access". This email will have instructions on how to complete registration process. Please check in your "Junk" folder in case this communication was misdirected in your email system.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

If you have any questions please contact us at sales@intellinews.com

Subscribe to bne IntelliNews website and magazine

Subscribe to bne IntelliNews website and monthly magazine, the leading source of business, economic and financial news and commentary in emerging markets.

Your subscription includes:
  • Full access to the bne content daily news and features on the website
  • Newsletters direct to your mailbox
  • Print and digital subscription to the monthly bne magazine
  • Digital subscription to the weekly bne newspaper

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

bne IntelliNews
$119 per year

All prices are in US dollars net of applicable taxes.

If you have any questions please contact us at sales@intellinews.com

Register for free to read bne IntelliNews Magazine. You'll receive a free digital subscription.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

Thank you. Please complete your registration by confirming your email address.
A confirmation email has been sent to the email address you provided.

IntelliNews Pro offers daily news updates delivered to your inbox and in-depth data reports.
Get the emerging markets newswire that financial professionals trust.

"No day starts for my team without IntelliNews Pro" — UBS

Thank-you for requesting an IntelliNews Pro trial. Our team will be in contact with you shortly.

Dismiss