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Specific Aspects of Public Debt Management in Austria

Specific Aspects of Public Debt Management in Austria. Overview Austrian Debt. Austria still with AAA-rating. 205 billion EUR total debt (72,3 % of GDP) in 2010 (184 billion EUR, 67,1 % of GDP in 2009) financial debt 187 billion EUR in 2010 (178 in 2009)

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Specific Aspects of Public Debt Management in Austria

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  1. Specific Aspects of Public Debt Management in Austria

  2. Overview Austrian Debt Austria still with AAA-rating • 205 billion EUR total debt (72,3 % of GDP) in 2010 (184 billion EUR, 67,1 % of GDP in 2009) • financial debt 187 billion EUR in 2010 (178 in 2009) • interest 2010: 9,9 billion EUR (including SWAPS) • - balance of current accounts 2010: surplus of 3,2 % of GDP (+ 2,3 % in 2009)

  3. Long-term sustainability threatened But: first time since 1996 cashflow negative • federal government in 2009 cashflow negative with 5,3 billion EUR; in 2010 reduced to -3,1 billion EUR • first time since 1996 • meaning: just to support current expenses including interest payments Austria • has to add new debt in such a year • -> consolidation necessary

  4. Financial crisis • Expenses or revenues for the taxpayers ? • 100 billion EUR rescue package (2008) • reduced to 65 billion EUR in 2010 and 15 billion in 2011 • 7,5 billion EUR preferred shares in banks (capital injections) • 22 billion EUR state guarantees • -> still too early to know the total costs of the rescue package • (even a small revenue is still possible)

  5. Total guarantees • +10,6 % due to financial crisis in 2009 • guarantees 2008: 113 billion EUR • guarantees 2009: 124 billion EUR • +10,6 % in federal guarantees • guarantees 2010: 129 billion EUR (+3,7 %)

  6. Debt composition Austrian debt with low FX-risk • 97 % in EUR, 3 % in FX (2009) • aggregated maturity 4,8 years (2010) •  low FX-risk, low roll-over-risk

  7. Risk management Luckily there was a steep learning curve of ÖBFA • after a paradigmatic audit (see WGPD-homepage) in 2009: • introduction of new limit systems for ÖBFA (maximum liquidity, maximum cost of carry) • purchases of SIV‘s were generally banned • the minister of finance led an expert group which drafted • new risk guidelines: • - introduction of stress tests - new watchlist (CDS-Spreads of counterparties)

  8. European Stability Mechanism (ESM) Austria participates in ESM • effective lending capacity of 500 billion EUR in discussion • Permanent stability mechanism after June 2013 (before EFSM/ European Financial Stabilisation Mechanism) • initial capital stock of „500 billion EUR plus buffer“ planned • smaller part paid-in shares, the rest in callable shares • discussions concerning auditing rights for NAOs and ECA

  9. Thank you very much for your attention!

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