Budapest, 15 November 2018 – In autumn 2018 the MNB reviewed the list of other systemically important institutions domiciled in Hungary. Based on the annual review, the list of the institutions concerned has not changed. Conforming to the decision of the MNB’s Financial Stability Board in 2016, the capital requirement for these institutions becomes effective from 2017 in a gradually increasing manner over a four-year period, which supports banks’ adaptation and strengthens financial stability.
The potential serious financial impediment of systemically important institutions (O-SIIs) may affect the institutions and their clients adversely; furthermore, through contagion effects, this may pose a threat to the functioning of the financial intermediary system as a whole and may indirectly lead to problems for the real economy as well. For this reason, the central bank, acting in its macroprudential capacity, defines and annually reviews the list of other systemically important institutions, and – based on their significance – prescribes capital buffers for them to decrease the probability of their default. In 2018, the MNB reaffirmed the systemic importance of the eight institutions identified last year.
In order to strengthen their shock absorbing capacity, in 2017 the central bank set capital buffer requirements in the range of 0.5 to 2 percent for the institutions affected, which will have to be completed gradually, by 2020. In 2019, according to the decision of the MNB’s Financial Stability Board, the capital buffer rates will increase along the announced phase-in paths. The schedule defined is consistent with international regulatory practices. Besides enhancing financial stability, the extended phase-in of the requirements is expected to contribute to healthy lending, and smooth preparation for the institutions concerned to meet their obligations.
The list of other systematically important institutions and the schedule of their capital buffer rates
|Institution||Capital buffer rate|
|OTP Bank Nyrt.||0.50%||1.00%||1.50%||2.00%|
|UniCredit Bank Hungary Zrt.||0.25%||0.50%||0.75%||1.00%|
|Kereskedelmi és Hitelbank Zrt.||0.25%||0.50%||0.75%||1.00%|
|ERSTE BANK HUNGARY Zrt.||0.125%||0.25%||0.375%||0.50%|
|Raiffeisen Bank Zrt.||0.125%||0.25%||0.375%||0.50%|
|Magyar Takarékszövetkezeti Bank Zrt.||0.125%||0.25%||0.375%||0.50%|
|MKB Bank Zrt.||0.125%||0.25%||0.375%||0.50%|
|CIB Bank Zrt.||0.125%||0.25%||0.375%||0.50%|
Note: The identification in 2018 was based on audited consolidated data as of 31 December 2017. The capital buffer rates for 2020 are indicative, as the MNB carries out the identification and the setting of capital buffer rates every year.
Magyar Nemzeti Bank