MIL OSI Poland – 16.05.2022 Information on transactions held by Ministry of Finance on the financial market in 2021

Source: Republic of Poland in English

Information on transactions held by Ministry of Finance on the financial market in 202116.05.2022

The Ministry of Finance informs that in 2021 following transactions were concluded on the financial market:
Interest Rate Swap Transactions (IRS) in domestic currency,
Cross Currency Swap (CIRS),
Exchange of foreign currency.
Interest rate swap transactions had maturity up to 1 year and total notional amounted to PLN 92.0 bn. The aim of these transactions was to distribute debt servicing costs over the time within the years 2021-2022. As a result of concluded transactions debt servicing costs in 2021 has risen and in 2022 has decreased by PLN 3.34 bn. Conclusion of transaction did not expose Ministry of Finance to market risk. The Supreme Chamber of Control did not raise any objections referring to the rationale and effectiveness of these operations. Settlement of transactions was undertaken according to Eurostat’s guidelines and methodology. Information about transactions were included in the fiscal notification for 2021 delivered to the European Commission.
In 2021 the Ministry of Finance concluded cross currency swaps with 3yrs maturity. As a result of the conducted cross currency swaps the Ministry of Finance exchanged CNH 3.0 bn for EUR 0.4 bn. During life of transaction the Ministry of Finance will receive annually fixed interest in CNH and will receive fixed interest in EUR as well. These contracts were included in the fiscal notification for 2021 which was reported to the European Commission. In accordance with the Council of Europe legal act cross currency swaps change the currency structure of debt and therefore are accounted for in the calculations of the general government debt level. The Supreme Chamber of Control did not raise any objections referring to the rationale and effectiveness of these operations.
In 2021, as in previous years, Ministry of Finance exchanged foreign currencies on the financial market and in the central bank. Total exchange on the financial markets amounted to equivalent of EUR 3.59 bn. The Supreme Chamber of Control did not raise any objections connected with the rationale and effectiveness of these operations.

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