EBRD head decries national targets for bank sector ownership
The head of the European Bank for Reconstruction and Development (EBRD) opposed the idea of national targets for ownership of banks yesterday, apparently referring to Hungarian Prime Minister Viktor Orbán's suggestion that several banks should leave and that Hungary should achieve 60% domestic ownership.
At present, about half of the country's banks are in Hungarian hands. Addressing an economic conference in Vienna yesterday, EBRD President Suma Chakrabarti said it would be healthy and welcome for some rebalancing of bank ownership among international and local investors in central and eastern Europe, provided that it follows a market-based process of some investors deciding to exit and local entrepreneurs stepping up to fill the gap.
"However, and I want to emphasise this: we at the EBRD do not believe in targets for national ownership in any sector," Suma said, without specifically mentioning Hungary. The EBRD chief said he thought that capital should continue to flow from advanced to emerging economies in Europe, which he described as good business for both sides. "Well structured and managed use of foreign capital should not be abandoned. We should not throw out the baby with the bath water, as we in Britain say," Suma was quoted by Reuters as saying.
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