The banking sector has a key role to play in supplying the credit required for sustainable economic growth. Active lending is the primary task of the banking sector responsible for this, in which the Hungarian Government is seen as a partner. Co-operation is demonstrated by on-going dialogue, predictability and agreements that are honoured. The banking sector has finally been able to increase the real value of its capital from the P/L of recent times, which is an essential prerequisite for the credit expansion required for rebuilding the economy.
In recent days, at the initiative of the Ministry of National Economy, we have reviewed current challenges to economic development and the macroeconomic environment. From the discussions, we have come to the conclusion that even in a rapidly declining interest rate environment, the current level of lending rates is a possible temporary constraint to credit expansion. Accepting the proposal of the Ministry of National Economy, the Hungarian Banking Association draws the attention of its membership, in a supportive manner, to the campaign aimed at boosting corporate lending. During the campaign, the interest rate premium above BUBOR on market-term corporate loans contracted between 1 February and 30 April 2024 and, in the case of investment loans, disbursed this year, can be waived by individual lenders for a period of 6 months. Commercial banks may accept this invitation on a voluntary basis, at their own discretion, in line with their own business policy objectives. The Hungarian Banking Association is confident that the reduction in corporate lending rates will provide a boost to Hungarian companies open to investment to start and complete their investments.
The Hungarian Banking Association also welcomes the end of the corporate interest rate freeze introduced in 2022. We are convinced that the discontinuation of market distorting measures, the reduction of significant burdens imposed upon the sector and the provision of the right conditions for market competition will result in better prices and conditions for customers, including companies that are implementing key investments and creating jobs – both being keys to recovery. In this we count on the support of the Government, the Ministry of National Economy, Partner Ministries and the central bank.
Budapest, 30 January 2024
Hungarian Banking Association