In 2020, the Magyar Nemzeti Bank launched a survey on banks' economic sentiment and strategic plans called the Bank Sentiment Survey. In designing the questionnaire, we relied heavily on the European Banking Authority (EBA) Risk Assessment Questionnaire. The first block of questions in the questionnaire, which forms the basis of the Bank Sentiment Index, is answered by domestic credit institutions every quarter, while the four additional blocks of questions containing strategic questions are answered every six months.
The purpose of the data submission is for the MNB to learn about banks' economic sentiment and strategic plans, as well as to create a Bank Sentiment Index. The questionnaire covers banks' business strategy, profitability, credit activity and portfolio quality expectations, asset-liability management and general economic prospects. As the activity of the banking system is procyclical, the Bank Sentiment Index can be used as an early warning indicator to ensure that the central bank receives a timely signal if institutions perceive factors that threaten banking activity. This provides significant support in recognising both banking and other financial crises and in taking the necessary economic policy action in due time.
The MNB conducts the survey within one month of each quarter, and publishes the aggregated survey results and set of figures on its website in the third month after each quarter.