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Hungary rejoins Moscow-based international banking group

The Council of the International Investment Bank (IIB) supported the renewal of Hungary's membership in the bank at its November 20-21 meeting in Sofia, the National Economy Ministry said. 

The request received unanimous support from the representatives of member countries. Members of Moscow-based IIB, established in 1970, are: Bulgaria, the Czech Republic, Cuba, Mongolia, Romania, Russia, Slovakia and Vietnam.

National Economy Minister Mihály Varga and IIB chairman Nikolay Kosov signed a memorandum of understanding on the legal and financial conditions of Hungary's renewing its membership. Hungary left the bank in 2000 because of its unsufficiently efficient and transparent operations, the ministry said.

The bank, which offers mid- and long-term credit for development projects, has been radically restructured to conform to international norms in the past two years, and forms its strategy and operations in tight cooperation with big international financial institutions, such as the EBRD, the EIB or the World Bank, the ministry said.

Renewing Hungary's membership fits well with Hungary's economic goals and its policy of Opening to the East, the ministry said. It also makes it possible to reactivate the earlier initial capital that Hungary paid in, worth €20 mln at current value.

Hungary is interested as a new member in strengthening IIB's financial position further and will increase its initial capital payment in line with the undertakings of the other member countries, the ministry said. IIB's paid-in capital was €272.6 mln as of July 2014, and it will be raised to €341.3 mln under an IIB Council decision taken in June 2013, the bank's website shows. Own funds reached €374 mln at the end of July.