The Hungarian banking system was characterised by ample liquidity and a strong capital position in 2025 H1 as well. Credit risks remained moderate, and the ratio of non-performing loans is at a historically low level. On the credit market, the dual trends of buoyant household lending and subdued growth in corporate credit persisted. The Home Start loan programme, available since 1 September, boosts demand in the housing market to a large extent, and its impact on house prices depends on the success of measures aiming to expand supply.
High profitability continued to improve the Hungarian banking system’s reserves in 2025 H1. After a slight decline, banks’ 12-month rolling return on equity (RoE) amounted to 19.1 per cent in June 2025. High net interest income continues to support banks’ profitability. The negative effect of loan losses on profit was minimal in the first half of the year. The ratio of non-performing loans is historically low. The capital adequacy ratio stood at 20.7 per cent at the end of June 2025, representing a free capital buffer of more than HUF 2,300 billion.
Banks’ liquidity position is ample. Liquidity held in the central bank’s reserve account fell by around HUF 1,300 billion between April and October, largely due to maturing long-term central bank loans. Banks’ operational liquidity reserves exceed HUF 21,000 billion. The sector’s average liquidity coverage ratio (LCR) was 168 per cent at the end of September, well above the required 100 per cent. Thus, no systemic liquidity risks can be identified. Reducing the windfall tax burden by purchasing government bonds and the tightening of central bank liquidity may only necessitate increased liquidity management only at a few individual institutions. The high shock-absorbing capacity of Hungarian banks is also demonstrated by our stress test exercises.
The dual trends on the household and corporate credit markets persisted in 2025 H1. Household loans outstanding grew at a year-on-year rate of 11.7 per cent, due to strong demand for loans, while the housing loan portfolio expanded by nearly 15 per cent. Demand for corporate loans continued to weaken, and thus the corporate loan portfolio grew at a year-on-year rate of just 2 per cent. The Certified Corporate Loan certification launched by the central bank in September 2025 may have a positive impact on demand for market based loans in the medium term. The reduction of administrative barriers in the credit market and the easier comparability of banks’ offers may also encourage companies that have not previously been present in the credit market to take out loans.
The latest subsidised housing loan programme (Home Start) launched by the government in September 2025 will lead to significant demand growth in both the credit and housing markets, due to its wide availability and the large maximum contract size. Based on preliminary data, nominal house prices rose by 23.9 per cent on an annual basis nationwide in 2025 Q3. The success of supply stimulus measures launched by the government is necessary to slow down further price appreciation. House prices are currently above the level justified by fundamentals. Overvaluation increases the risk of a house price correction, which would also have a negative impact on the valuation of loan collaterals.
In September 2025, the MNB adopted a comprehensive macroprudential package targeting mortgage loan market risks. As part of this, from January 2026, in order to strengthen the forward-looking, preventive nature of the systemic risk buffer (SyRB), the MNB is replacing the current requirement with two sectoral SyRBs at a rate of 1 per cent each for exposures to Hungarian customers which are backed by domestic residential and commercial real estate.
https://www.mnb.hu/en/publications/reports/financial-stability-report