Debt Portfolio Management Quarterly Report - 1st Quarter 2025
The Ministry of Finance presents, in accordance with the calendar of published information, the Debt Portfolio Management Quarterly Report, which contains the state of fulfilment of the operational funding programme and issuance activity plans in relation to the announced strategic targets and limits specified in the Czech Republic Funding and Debt Management Strategy for 2025 published on 6 January 2025. It also includes regular quarterly evaluations of primary dealers for the period from the second quarter of 2024 to the first quarter of 2025, with PPF banka a.s., KBC Bank NV / Československá obchodní banka, a. s. and Société Générale / Komerční banka, a.s. being the three most active banks in this period.
The absolute value of state debt reached CZK 3,410.2 billion at the end of the first quarter of 2025, which represents an increase of CZK 45.0 billion compared to the end of 2024. It is mainly due to the sale of government securities during the first quarter of 2025 to smoothly cover the redemptions of the state debt in the first quarter of 2025 and the state budget deficit, which reached CZK 91.2 billion at the end of March 2025. In relative terms to GDP, state debt remained stable at 42% compared to the end of last year.
During the first quarter of 2025, CZK-denominated medium-term and long-term government bonds in a total nominal value of CZK 109.2 billion were sold on the primary and secondary market with the average residual time to maturity of 9.1 years. The average yield on the newly sold fixed-rate CZK-denominated medium-term and long-term government bonds was 4.0% p.a. In addition, the CZK-denominated state treasury bills in a total nominal value of CZK 53.3 billion were sold and, at the same time, there was no redemption of the CZK-denominated state treasury bills during the first quarter of 2025. The total nominal value of the CZK-denominated state treasury bills outstanding at the end of the first quarter of 2025 was CZK 84.8 billion.
During the first quarter of 2025, Fitch Ratings affirmed the Czech Republic’s current rating at AA- level for long-term local and foreign currency liabilities with a stable outlook. According to the agency, the high rating is supported by credible macroeconomic and monetary policies, a robust institutional framework underpinned by membership of the European Union and a declining general government deficit as a result of the implementation of consolidation measures. In addition, in the first quarter of 2025, S&P Global Ratings affirmed their current ratings at AA level for long-term local currency liabilities and at AA- level for long-term foreign currency liabilities, also with a stable outlook. The Czech Statistical Office also announced in the spring notification of the deficit and debt of the general government sector that the total deficit for 2024 was 2.2% of GDP, which was a year-on-year decrease by 1.5 percentage point. The structural deficit then fell to 1.9% of GDP.