Budapest, 30 September 2024 – Due to the still high geopolitical and macroeconomic uncertainty, the MNB set the applicable Countercyclical Capital Buffer (CCyB) rate for domestic exposures effective from 1 July 2025 at 1 percent s applicable in neutral risk environment, which has been left unchanged from 1 October 2025, as well, due to the low level of cyclical risks.
In accordance with the previously communicated schedule, the MNB increased the applicable Countercyclical Capital Buffer (CCyB) rate for domestic exposures effective from 1 July 2024 from 0 percent to 0.5 percent. In addition, from 1 July 2025, the MNB decided to apply a positive neutral CCyB rate of 1 percent for domestic exposures in a neutral risk environment that is not characterized by overheating or cyclical risk. The MNB deviates from this level upwards in the event of an increase in cyclical risks, and downwards in the event of a substantial stress situation visible in the financial sector.
In the last quarter, despite the gradual growth in lending the domestic cyclical systemic risks remained low. The additional credit/GDP gap, which serves as a buffer guide regarding the development of cyclical systemic risks, showed a value of -4.2 percentage points, significantly below the threshold indicating overheated lending, in the first quarter of 2024. Furthermore, based on the supplementary indicators monitored, there is no indication of the intensification of the currently low level of cyclical systemic risks. In terms of lending, a pick-up can be observed, in parallel with a slight real estate overvaluation, which can be interpreted as a normalisation following the decline in lending that had occurred in the last two years, not as an excessive increase in cyclical risks. Looking ahead, the normalising inflation and interest rate environment, the strengthening of economic activity, as well as the return of real wage growth and thus the strengthening of consumer confidence point in the direction of increasing cyclical systemic risks. Nevertheless, based on the currently low level of cyclical, lending market overheatedness risks, the application a CCyB rate for domestic exposures of more than 1 percent that should be set in neutral risk environment is not warranted. Therefore, the MNB has left unchanged the CCyB rate applicable from 1 July 2025 at 1 percent and has not changed it from 1 October 2025 either due to the low level of cyclical systemic risks.
The Financial Stability Board of the MNB quarterly decides on the applicable CCyB rate taking into consideration the positive neutral CCyB rate, in view of the development of cyclical systemic risks stemming from lending overheatedness and any other relevant factors.
Magyar Nemzeti Bank