Losses in some years were always covered by profit reserves from the previous years during the period, the bank said. The MNB’s operating costs in 2010 were slightly under those in 2002 in nominal terms and they fell almost 40% in real terms, the bank noted.
The equivalent of 2.1% of GDP in budget transfers were made by the state to the MNB during the period to prevent even a temporary drop in the bank’s net assets due to unrealized losses due to changes to exchange rates and yields. About 90% of the transfers — made in line with the Central Bank Act — took place in 2002-2003 when the forint firmed sharply after its intervention band was widened, the bank said.
The MNB stressed that it is not a profit-oriented organization. Changes to its profits and balance are determined first of all by domestic and international economic trends affecting things such as interest rates and exchange rates.
The MNB has continuously warned against the danger of a high general government deficit, which is the main cause of the growth of state debt, the bank said.
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