15. August 2014

Dear Editor,

Kester Eddy’s article, entitled ‘Company resort makes its comeback at Hungary’s central bank’ and published in your Beyondbrics comment blog on 11 August, discussed the Magyar Nemzeti Bank (MNB), its social responsibility strategy and the training and recreational centre it had purchased. However, several of the author’s comments call for correction.

The primary objectives and tools of the MNB’s corporate social responsibility programme are identical to those of other central banks in Europe. The elements of this programme that apply to MNB employees and the benefits made available for them are also in line with the strategies of a number of other European central banks. The Magyar Nemzeti Bank, like other EU central banks, also seeks to provide its more than one thousand employees with fringe benefits.

Although the Beyondbrics article discusses the MNB’s purchase of a training and recreational centre at great length, it fails to mention that the Hungarian central bank used to own nearly two dozen properties in past decades, seven of which were specifically used for recreational purposes, and that this network had been disposed of by 2009. Accordingly, as a result of its recent real estate purchase, the MNB now owns a single training and recreational centre, in contrast to the previous seven. The recently acquired property is located in East Hungary, the country’s least developed region. More than 30 new jobs have been created since the Bank’s taking possession of the new centre and every single one of the new employees is a local resident. The full operation of the property – functioning as a recreational centre from May to end-August and as a training centre from September until the end of April – will require even more new employees. The MNB informed the general public about the acquisition of the property in a press release on 7 August and then it answered all journalists’ questions. Therefore, contrary to the claims made in the article, no withheld information was left for investigative journalists to uncover.

Unfortunately, the author drew wrong conclusions from false assertions, and in the wake of the acquisition of the recreational centre he goes as far as envisioning the return of communism to Hungary, thereby misleading Financial Times readers.

Training and/or recreational centres are used for example by the German, Belgian, Portuguese, Czech, Polish and Romanian central banks, some even having multiple recreational properties. The German central bank has several holiday resorts (in Wyk auf Föhr, at Tengernsee, in Zehlendorf and in Berlin), along with two training centres near Frankfurt am Main. We just don’t think that the ownership of these real estates could jeopardise the existence of market economy in Germany. The acquisition of a mansion does not count as an extreme case in central banks’ practices: Poland’s central bank for instance has three recreational centres for its employees: a 28-room neo-Gothic palace in Starawieś, a resort for 182 at the Lakes Mazur and one for 60 in Zakopane. The central bank of Romania has two training and recreational centres, one in Bucharest and one in Compatu-Siaina. Belgium’s central bank uses a recreational centre in St. Agatha Berchem, while the Portuguese central bank is running a recreational centre – complete with a riding school – in Quinta da Fonte Santa to entertain children and to conduct training programmes for the bank’s employees. The question is whether the author of the article will also have grave concerns about the Portuguese market economy.

In contrast to the assertions contained in the article, the Magyar Nemzeti Bank is not the ‘happiest barrack in the Bloc’ – instead, it is determined to encourage the development of the market economy through its monetary policy (including a series of interest rate cuts and the Funding for Growth Scheme). The MNB’s efforts also contributed to the Hungarian economy growing by 3.9% year on year in the second quarter of this year, which is currently the highest growth rate in the European Union.

Magyar Nemzeti Bank Communications

Eszter Hergár

Communications Manager