MNB: Banks hedged CHF/EUR risk by end of 2014

In Hungary

All Hungarian banks had taken the necessary steps to acquire Swiss franc for euros by the end of 2014, the National Bank of Hungary (MNB) said yesterday, noting that the rates for borrowers had already been fixed under last year's legislation on the conversion of retail FX home mortgages into forints.

The forint, together with other currencies, weakened sharply against the Swiss franc after the Swiss National Bank lifted its minimum exchange rate of CHF 1.20 to the euro yesterday morning. The forint weakened against the euro and the US dollar too.

The Thursday NBH statement said that the government, the NBH and the domestic financial system had prepared in due time to manage the exchange-rate-related risks by fixing the rate of the FX mortgage conversion, taking effect on February 1 this year, in advance, already late last November. The actual installment payments on the affected FX home mortgages have been at the then-fixed rates since January 1.

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