Nearly half a year after the entry into force of the Hungarian Act on automatic conversion of foreign currency loans fell to HUF financial burden on households, but increased the pressure on the banks.
January 1, entered into Life adopted in November last year a law according to which all mortgages in francs, euros and yen were automatically converted into forint loans. In accordance with an agreement between the banks and the team of Prime Minister Viktor Orban, the conversion rate for the franc stood at 256 forints and 309 forints per euro (it was the course of November 7 ub.r.).
The team Orban decided to take such a step to alleviate the many citizens who pozaciągali mortgages before the crisis of 2008., And then found themselves in a spiral of debt. The value of those loans totaled the equivalent of 10 billion euros.
The Secretary General of the Association of Hungarian Levente Kovacs rated banks in the second half of May that borrowers have gained on this bill for a total of one trillion forints (13.3 million zł), “and it’s as if everyone, from baby after old man, got 100 thousand. forints (over 1.3 thousand. zł) “.
“In Hungary, the amount of the installments of households fell by roughly 20 per cent., Which is beneficial also from the macroeconomic point of view, as it stimulates domestic demand”, – stressed in response to PAP b. The President of the Hungarian National Bank prof. Gyoergy Suranyi, asked to assess the impact of the Act on currency translation of loans.
The move Orban government, ahead of the January jump franc, has gained recognition abroad. The International Monetary Fund in March communication positively assessed the condition of the Hungarian economy, stressing that, thanks to strong domestic demand, GDP grew in 2014. By 3.6 per cent., As well as falling unemployment. “Exposure (economic) shocks has been steadily declining thanks to the large and persistent surplus current account balance and recent political decisions, including currency conversion of foreign currency mortgage loans to local currency”, – noted the IMF.
The Fund stressed however, that the law, along with earlier, requiring banks to compensate customers spreads and unilateral adjustments in the contracts, seriously affected the banking sector.
“And without that deficit, the banking sector recorded a loss equating to approximately 2.5 per cent. Of GDP. This of course severely limits the creditworthiness of banks, and so is detrimental to growth” – rated Suranyi.
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