Unicredit exec: Forex burden must be gradual

Analysis

Unicredit CEE Division director Gianni Franco Papa yesterday declared that Hungary-based banks “should not be burdened all at once to help out borrowers who hold mortgages in foreign currency” in a forex loan bailout program.

Papa went on to suggest that “If the burdens are introduced gradually then the situation can be handled by the affected banks, companies, private individuals, governments and central banks.”

“The only thing that could really solve the problem would be if the Hungarian economy picked up,” Papa told international media last week. “We need a more stable situation between the government and the financial side but not only the financial side [so that] there is confidence coming back to the country, the economy, and therefore the exchange rate of the forint will improve.”

Unicredit branch Bank Austria currently has about €500 million in forex-based loans outstanding in Hungary.

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