MNB Publishes Results of Lending Survey, Issues Other Updates
The Hungarian National Bank (MNB) published the results of its lending survey for the fourth quarter of 2022 and imposed a fine of HUF 11 million on Duna Takarék Bank Zrt. for financial violations concerning the provision of payment services and decree on handling of money, account exchange, fee statements, and cross-border payments in the Union. Additionally, the Statistics Directorate of the MNB, in addition to its recently renewed Publication Portal, launched a new Data Service Portal (ASZP) that aims to complete the data services on time and in good quality, by providing a more structured display of the information required to fulfil the data provision obligations (filling instructions, tables, technical aids, etc.) as well as support the registration required for data submission and the submission process.
The lending survey results show that a net 23% of banks tightened the terms of residential and corporate loans in the fourth quarter of 2022, citing deteriorating economic prospects and industry-specific risks. On the other hand, 70% and 31% of banks reported increasing demand for foreign currency loans and short-term loans respectively, demand for which may increase in the first half of 2023. Corporate loan demand shifted towards short-term and foreign currency loans with the need for higher working capital and liquidity financing. With regard to commercial real estate market, a net 23% of banks tightened their business real estate loan standards in the fourth quarter, which mainly affected shopping centers and office buildings. Moreover, 27% of banks tightened their consumer credit standards during the fourth quarter of 2022 due to increase in funding costs, the deterioration of the creditworthiness of customers, and the negative economic outlook. Almost all banks sensed a decline in credit demand for housing and consumer loans, and their smaller proportion expects a further decline in the first and second quarters of 2023.
Keywords: Europe, Hungary, Banking, Lending, Credit Risk, CRE, Mortgage Lending, Liquidity Risk, Market Risk, Data Service Portal, Compliance Risk, MNB
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