Budapest, 3 October 2022 – Although the risks in the real estate market still persist, because of the changing growth and lending prospects, the Financial Stability Board of the MNB sets the countercyclical capital buffer rate at an unchanged 0.5 percent as of 1 October 2023.
The Financial Stability Board (FSB) of the Magyar Nemzeti Bank (MNB) sets the countercyclical capital buffer rate applicable to exposures in Hungary as of 1 October 2023 at an unchanged 0.5 percent level that comes into force from 1 July 2023.
In the course of the latest rate review in June 2022, the MNB decided to increase the capital buffer rate applicable to domestic exposures for the first time since 2016, which was justified by the high and rising level of cyclical systemic risks and housing market overvaluation.
The latest data supporting the rate decision indicate a slight easing of the risks in the banking sector, but the real estate market is still significantly overheated. Although this would refer to a further increase of the countercyclical capital buffer rate, the changing growth and lending prospects related to the war developments and the European energy crisis, and the risk of a deterioration of bank portfolio quality do not yet justify a further increase of the countercyclical capital buffer. The MNB will decide depending on the development of risks on a possible future increase or release necessary in the event of a significant deterioration in the real economic situation and a related increase in financial sector stress.
The countercyclical capital buffer rate applicable to domestic exposures is reviewed by the MNB on a quarterly basis.
Information about the countercyclical capital buffer and its operation
Magyar Nemzeti Bank