Clients took out loans with better conditions than those applicable to forint loans at the time, so they should bear the risks involved, the head of the Kúria’s civil department, György Wellmann, said after the court’s ruling, whose purpose is to provide guidance to the lower courts.

He added that the damaging consequences of economic and social problems linked to lawsuits filed by FX borrowers against the banks cannot be addressed purely by legal means, and the solution cannot be expected from the courts.

The court noted that banks have an obligation to inform their clients about the risks of exchange rate fluctuations and their effect on the monthly repayments. It added that if a court finds a part of a contract invalid, it should aim not to invalidate the whole contract but only the part in question. Hungary’s highest court has taken the side of banks, Antal Rogán, head of the parliamentary group of the ruling Fidesz party, told a press conference.

The opposition Socialists said that there were no further reasons to put off measures planned to help mortgage holders. Party lawmaker Gábor Simon said that the issue was not solely a legal one but had complex social and economic dimensions.

The radical nationalist Jobbik party said the court ruling had sacrificed the Hungarian population to the will of the banks. The opposition E14-PM party said that now the government should no longer kick the problem further down the road but solve it in line with the rule of law.

Banking Association secretary general Levente Kovács said the ruling proved banks had been “in the right all along”. Kovács told MTI after the decision that banks would follow the court ruling “to the letter”.

He said the Kúria had solved many unresolved issues and legal loopholes, and that it ruled that foreign currency contracts are “live and legal”, which must be respected. He added that, at the same time, the banking sector understands the social difficulties which lie behind these contracts and will help alleviate these strains.

Source www.hungarymatters.hu

Follow that link to sign-up for MTI’s twice-daily newsletter.