Budapest, 27 June 2024 – In order to prevent the development of financial stability risks related to commercial real estate project loans, the Financial Stability Board of the MNB revised the banks’ systemic risk buffer rates effective from 1 July 2024. Based on the exposures and capital situation on 31 March 2024, the risks remained moderate for all institutions; accordingly, no bank is required to maintain a Systemic Risk Buffer yet.
In June 2023, the MNB decided to reactivate the Systemic Risk Buffer (SyRB), which was suspended at the outbreak of the coronavirus epidemic, for preventive purposes due to the increasing risks observed globally in the commercial real estate market. In October 2023, the Financial Stability Board announced the revised criteria for establishing the SyRB.
In line with these conditions, the MNB determined the capital buffer requirements for individual institutions based on the existing commercial real estate financing project loan portfolios and capital situation as of 31 March 2024. In accordance with the still low risk levels and the preventive application of the instrument, from 1 July 2024, no bank is required to maintain an SyRB. The MNB will carry out the next revision of the capital buffer rates, in addition to continuous monitoring of exposures, within one year, until June 2025, based on data as of 31 March 2025.
The announcement of the reactivation of the systemic risk buffer in June 2023 effectively encouraged the prudential review of banks' portfolio of project loans financing commercial real estate. As a result of the announcement, a review of the restructured portfolios that increased at several banks due to participation in the payment moratorium introduced during the coronavirus pandemic was conducted, and they were handled in accordance with prudential requirements and reclassified as necessary.
Further information on the applied systemic risk buffer
Magyar Nemzeti Bank