Hungarian Banking Assoc Believes Quaestor Clients Have No Right To Compensation
- 20 Apr 2015 4:00 AM
The Hungarian Banking Association believes clients of failed brokerage Quaestor should not receive any compensation, chief secretary Levente Kovács said on public radio. Kovács noted that Quaestor had clearly informed its clients that its securities - which paid a yield well over that of government securities - were covered neither by the National Deposit Insurance Association (OBA) nor the Investor Protection Fund (Beva).
“I don’t think it’s ethical for somebody to ask to be compensated if that person wasn’t insured,” he said. He added that the Constitution would appear to support the Banking Association’s stand on the matter.
Lawmakers recently approved legislation establishing a top-up fund to compensate Quaestor clients who bought some 150 billion forints in unsanctioned bonds. Setting up the fund effectively raises the compensation threshold for the clients from the equivalent of 20,000 euros to 100,000 euros, footing Beva members with the bill.
Kovács acknowledged the government’s efforts to stick to an agreement with the EBRD that requires consultations with lenders before burdening the banking sector further, adding that consultations were under way.
He said the bank levy would be reduced but the reduction would be much smaller than the amount banks must pay into Beva to compensate Quaestor clients.
Source www.hungarymatters.hu
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