Hungary takes conciliatory line on foreign currency loans
Hungarian legislators have stepped back from making a retroactive change to foreign currency mortgage loan contracts. The government will now consult with the country’s banking association before taking any action, it said on Wednesday. Bankers had feared that such a move would have severely destabilised markets, potentially hitting covered bonds.
Hungarian banks were thrown into a spin on July 18 when Hungary’s deputy prime minister Tibor Navracsics said the government was considering introducing legislation to retroactively modify foreign currency mortgage loan contracts.
However, after parliament briefly discussed the subject on Wednesday this week, a more conciliatory line now
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