NBH: Hungary Prepared For Brexit Effects

  • 25 Jun 2016 9:00 AM
NBH: Hungary Prepared For Brexit Effects
The National Bank of Hungary (NBH) has prepared for both outcomes of the British vote on European Union membership, NBH managing director Dániel Palotai told MTI after UK voters decided to leave to bloc at a referendum. “We continuously monitor the reactions of financial markets,” Palotai said on the sidelines of a conference. “We have all the necessary tools to ensure financial stability,” he said.

Economy Minister Mihály Varga said earlier in June that the UK’s exit from the EU could slow Hungary’s GDP growth rate by 0.3-0.4 percentage points.

The Hungarian Banking Association said that the bank sector has already started developing emergency action plans before the referendum and banks will now analyse the longterm effects and strive for a managed transition. “On behalf of the bank sector, we can assure private clients and companies that banking services will continue as usual,” it said.

An expert told public news channel M1 on Friday morning that “earthshattering changes” were ahead in wake of the leave vote, with a level of uncertainty similar to “diving head on into darkness”.

Zoltán Gálik, a professor at Corvinus University, said early elections would soon be called in the UK, to be potentially followed by a Scottish or even a Northern Irish referendum on leaving the UK.

The British referendum is a warning for European elites that a small party such as UKIP was able to win the vote with “a campaign based on emotional topics such as immigration and the promise of old-style sovereignty,” he said.

A state secretary at the economy ministry said the changes will affect Hungary, Europe and the whole world and banking and corporate sectors will both have to “go through renewal”.

Reuters reported early Friday morning that according to nearly complete results 51.8% of UK voters backed leaving the EU while 48.2% voted to remain.

Republished with permission of Hungary Matters, MTI’s daily newsletter.

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