“The potentially high costs of a new law requiring Hungarian banks to compensate loan customers will require material capital injections from foreign parents to restore regulatory capital and lending capacity,” Fitch Ratings said in a statement.

“We will review the ratings of Hungarian banks once we have analysed the impact of the new law on individual banks’ credit profiles, and assessed the foreign parents’ readiness to offset losses with further capital injections, where required,” the agency added.

National Bank of Hungary deputy governor Ádám Balog said earlier that the refunds could cost Hungary’s financial system 600-900 billion forints (EUR 1.9-2.9m).

Source www.hungarymatters.hu

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