14 May 2012 – The report presenting the 2011 activity and financial management of the Magyar Nemzeti Bank is available to the public as of today. In 2011 the operating costs of the Bank remained below HUF 12 billion, which is unprecedented since 1997.

In 2011 the Magyar Nemzeti Bank recorded a profit of HUF 13.6 billion, as opposed to the loss of HUF 41.6 billion in 2010. This improvement is primarily attributable to the weakening of the forint during 2011 and the profit originating from the euro sales related to the early repayment scheme.  In parallel with that, net expenditures stemming from other income and expense items were at even lower levels than in the previous year. For example, the costs of cash production fell considerably, to nearly one half relative to the previous year. In addition to the lower demand for cash, this decline was a result of the cash-related strategic measures introduced by the Bank in the past three years, which may as well entail total savings amounting to tens of billions of forints over the longer term. The year 2011 profit is added to the retained earnings of the Bank to cover possible losses of the coming years.

Developments in the profit/loss of the Magyar Nemzeti Bank are mainly determined by the objectives of monetary policy and the means needed for achieving these objectives. Therefore, central bank profit/loss is not a measure of the success of central bank operation. The performance of the basic tasks specified in the MNB Act, i.e. the achievement and maintenance of price stability, cannot be influenced by the effect on the profit/loss. At the same time, the Bank keeps its operating costs at a reasonably low level, and uses the taxpayers’ money economically.

Similarly to previous years, in 2011 the Bank continued to cut its operating costs significantly; as a result, they were reduced by HUF 900 million last year. Operating costs in real terms were lower by one third in 2011 than in 2006, representing a real cost reduction of HUF 5.7 billion, i.e. 38 per cent compared to the beginning of the period. Operating costs in 2011 calculated at a nominal value were below HUF 12 billion for the first time since 1997.

In addition to attending to its basic tasks, the MNB has developed and operated exemplary programmes in all the main areas of social responsibility. In the Hungarian public sector the MNB was the first to introduce an environmental management scheme, which takes account of the aspects of energy efficiency and sustainability in day-to-day operation. In 2011 the Bank continued its educational programme for the development of the financial literacy of citizens. An outstanding achievement of the Money Compass Foundation is that in the 2011/2012 school year, within the Financial Education Programme, 2800 students of 60 secondary schools are acquiring economic and financial knowledge necessary for everyday use.

Please note that the English version of the Annual Report will be published at the end of May.