Featured Product

    MNB Issues Climate Stress Test Results and Macro-Prudential Report

    The Hungarian National Bank (MNB) presented key results of its long-term climate stress test at the International Green Finance Conference. The MNB Deputy Governor Csaba Kandrács, Deputy Governor of the MNB, highlighted, in his presentation, that—both globally and in Hungary—a swift and orderly transition to a carbon-neutral economy, as soon as possible, would be important for the quality of bank credit. Presentations and panel discussions at the conference focused on the implications of the COP26 climate summit for the financial system and further environmental anomalies beyond climate change. At the conference, the Green Finance Awards for financial institutions and the Green Finance Science Awards for excellence in academia were also presented. In a separate development, MNB has published the Macro-Prudential Report for 2021, which presents the macro-prudential measures of the past year, the adaptation of market participants to the ongoing crisis, and the broader economic effects of regulatory measures.

    The Macro-Prudential Report highlights that the liquidity position of banking system remains stable while the liquidity coverage ratio (LCR) of the banking sector has been rising steadily since the onset of the coronavirus pandemic, mainly due to central bank measures. The net stable funding ratio (NSFR) requirement, which limits the maturity mismatch of institutions, came into force at the European Union level in June 2021, but its introduction did not require significant adjustments for domestic banks in view of the own funding requirements of MNB. The report notes that there is a significant gap in the availability and use of data at the domestic level, thus hindering the time and cost reduction required for lending processes, the deepening of finances, the spread of digitalization and green financial products, factors which in in turn contribute to weakening the competitiveness of the banking sector and the country. To strengthen the digitalization of banking operations, in addition to market developments, it is necessary to improve access to the State databases, an initiative in which the country significantly lags behind the rest of the European Union. 

    In addition, MNB announced that, according to Sustainable Financial Regulation and Central Bank Activities Tracker developed by the World Wide Fund for Nature (WWF), its sustainability activity and measures for handling financial risks related to climate change are the most advanced. The Tracker, which was released in October 2021, assessed the financial regulatory environment of 37 countries, including Hungary, in three sustainability categories: climate, environment, and society. Overall, the evaluation paints a very positive picture of the sustainability-related activities of the central bank of Hungary.

    Keywords: Europe, Hungary, Banking, Climate Change Risk, Stress Testing, ESG, Sustainable Finance, Liquidity Risk, Regulatory Capital, Systemic Risk, Macro-Prudential Policy, MNB

    Featured Experts
    Related Articles
    News

    EU Agencies Update LCR Rule and Macro-Prudential Policy Recommendation

    The European Commission (EC) published the Delegated Regulation 2022/786 with regard to the liquidity coverage requirements for credit institutions under the Capital Requirements Regulation (CRR).

    May 23, 2022 WebPage Regulatory News
    News

    EBA Publishes Regulatory Standards to Identify Shadow Banking Entities

    The European Banking Authority (EBA) published the final draft regulatory technical standards specifying the criteria to identify shadow banking entities for the purposes of reporting large exposures.

    May 23, 2022 WebPage Regulatory News
    News

    EIOPA Examines Physical Climate Risk Exposure, SII Non-Compliance

    The European Insurance and Occupational Pensions Authority (EIOPA) published a report assessing insurers' exposure to physical climate change risks

    May 20, 2022 WebPage Regulatory News
    News

    NGFS Report Explores Quantification of Climate Risk Differentials

    The Network for Greening the Financial System (NGFS) published two reports to aid central banks and regulators in their oversight of the financial sector and in their central bank operations

    May 19, 2022 WebPage Regulatory News
    News

    EC Publishes Results on Review of Web Accessibility Directive

    The European Commission (EC) published the results of a public consultation, held in October 2021, on the review of the Web Accessibility Directive.

    May 19, 2022 WebPage Regulatory News
    News

    MAS Consults on Adjustment Spreads for Conversion of SOR Contracts

    The Monetary Authority of Singapore (MAS) and the SC-STS are jointly consulting, until June 10, 2022, on setting adjustment spreads for the conversion of legacy SOR contracts to SORA reference rate.

    May 18, 2022 WebPage Regulatory News
    News

    OSFI Discusses Benchmark Rate Transition, Sets Out Work Priorities

    The Office of the Superintendent of Financial Institutions (OSFI) published the strategic plan for 2022-2025 and the departmental plan for 2022-23.

    May 17, 2022 WebPage Regulatory News
    News

    EBA Proposes Standards to Support Secondary NPL Markets

    The European Banking Authority (EBA) is consulting, until August 31, 2022, on the draft implementing technical standards specifying requirements for the information that sellers of non-performing loans (NPLs) shall provide to prospective buyers.

    May 17, 2022 WebPage Regulatory News
    News

    EU Confirms Agreement on Rules on Cybersecurity and Banking Resolution

    The European Council and the Parliament reached an agreement on the revised Directive on security of network and information systems (NIS2 Directive).

    May 13, 2022 WebPage Regulatory News
    News

    EBA Issues Standards for Crowdfunding Service Providers Under ECSPR

    The European Banking Authority (EBA) published the final draft regulatory technical standards specifying information that crowdfunding service providers shall provide to investors on the calculation of credit scores and prices of crowdfunding offers.

    May 13, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 8206