Budapest, 6 November 2025 – The macroprudential policy of the Magyar Nemzeti Bank (MNB) strongly contributes to maintaining the strong financing capacity of the domestic banking system. The MNB addresses elevated real estate market risks in a targeted manner through a comprehensive regulatory package for the mortgage market, supporting the smooth functioning of lending processes and the stability of the banking system. Over the past year, the central bank’s regulatory focus has been on the gradual increase of releasable capital buffers, the fine-tuning of borrower-based measures and funding requirements, as well as the enhanced monitoring of cyber risks and related international regulatory trends.
The MNB annually assesses the effectiveness of its macroprudential toolkit aimed at mitigating systemic financial stability risks, and banks' adaptation to these requirements. The 2025 publication reviews the macroprudential measures of the past year, the adaptation of market participants, and the impact of regulatory steps. It covers as key topics macroprudential capital buffers, particularly the sectoral systemic risk buffer (sSyRB) requirement targeting real estate market risks, the utilization of more favourable loan-to-value (LTV) limits for young first-time home buyers, and the financial stability and regulatory significance of climate and cyber risks.
Due to the current macroeconomic uncertainty and elevated real estate market risks, the MNB is strengthening the banking system's shock-absorbing capacity by increasing capital buffer requirements that are releasable during crises. Taking effect from 1 July 2025, the MNB requires a 1 percent so-called "positive neutral" countercyclical capital buffer (CCyB) rate for domestic exposures, which is required in a neutral cyclical risk environment. In connection with elevated real estate market risks, and to strengthen the forward-looking nature of the systemic risk buffer (SyRB), the MNB decided on the sectoral application of the SyRB instead of the previous requirement targeting risks from project loan exposures secured by commercial real estate. Accordingly, a 1 percent capital requirement both for domestic residential and commercial real estate-backed exposures to Hungarian counterparties will be introduced from 1 January 2026. During its 2024 review, the MNB did not change the list of domestic systemically important institutions (O-SII) and left their individual buffer rates prescribed for 2025 unchanged. Due to the banking system's adequate capital position and favourable profitability, the increase in capital requirements enhances banks' resilience without significantly weakening lending capacity.
In light of the nominal wage increases in recent years and the need to maintain the smoothness of lending processes, the central bank decided to amend its borrower-based measures (BBMs) during its annual review. Effective from 1 January 2026, the MNB will raise the income threshold – which allows for a higher debt-service-to-income ratio of up to 60 percent, last modified in July 2023 — from 600,000 HUF to 800,000 HUF and the limit for small-value loans exempt from the BBM application from 450,000 HUF to 550,000 HUF. The amendments aim to support the avoidance of excessive risk-taking without materially impeding retail lending.
Several regulations also enhance the stable operation of the banking system from a liquidity and funding perspective, which are fulfilled with adequate buffers by the institutions. Responding to the significant increase in mortgage lending, the MNB decided on the regulatory fine-tuning of the Mortgage Funding Adequacy Ratio (MFAR) regulation to strengthen sector-level stable funding and the liquidity of the mortgage bond market, also supporting bank adaptation. The modifications may increase competition among market players and further strengthen the stable funding of mortgages.
The central bank continuously develops its crisis management toolkit. The MNB closely monitors the stock and concentration of bonds convertible into capital in crisis situations (MREL bonds), which are also sold to households, and may impose related restrictions if necessary. To make crisis management processes more transparent, the MNB, similarly to several foreign central banks, is examining whether publishing certain elements of the central bank’s emergency liquidity assistance (ELA) procedure on its website and communicating them directly to institutions could help avoid bank stigmatization, thereby supporting investor confidence and ensuring the smooth execution of the entire process.