NBH Financial Stability Report

The National Bank of Hungary released its financial stability report on Wednesday.

The National Bank of Hungary released its financial stability report on Wednesday, where it states that Hungary's banking system is improving its risk management, as well as strengthening its tools for collecting repayments and restructuring lending conditions for borrowers. Hungary's high-net external debt, loan-to-deposit ratio, and the large stock of foreign-currency denominated retail loans all declined in 2009, but stayed high relative to other countries in the region, and remained a cause of vulnerability.
The regulation of retail lending conditions was a necessary step, but the banks' reluctance to lend to corporations could hinder economic growth. The volume of business loans fell 8.4pct last year, and the NBH expects corporate lending to start growing slowly in the second half of the year, but with no palpable growth before 2011.
 

News Monitoring