Banks hammered with HUF 9.5 billion fine for “cartel activity”
The Hungarian Competition Authority (GVH) announced today that 11 banks representing a combined market share of nearly 91% in the country had been levied with a combined HUF 9.5 billion in fines for cartel activity during an early payback scheme for borrowers with foreign currency-denominated loans that ran from late 2011 to early 2012.
In order of penalty assessed, GVH fined OTP Bank HUF 3.9 billion, Erste Bank Hungary HUF 1.73 billion; K&H Bank HUF 983 million; CIB Bank HUF 835 million, MKB Bank 783 million, Raiffeisen Bank HUF 584 million, UniCredit Bank HUF 306m, Budapest Bank HUF 284 million, Ingatlanhitel HUF 63 million, Magyar Takarékbank HUF 1 million, and Citibank just under HUF 1 million.
FHB Mortgage Bank was also investigated by GVH authorities, but managed to avoid penalty because “it was a passive participant in the cartel and had never participated in any similar activity,” according to a report from national news service MTI.
Under the early payback scheme, borrowers were allowed to repay forex-based loans at discounted exchange rates. Lenders were left to pick up any difference based on changing exchange rates.
GVH established, based on email correspondence and other communication among the financial institutions that the banks had in fact colluded to dissuade would-be customers from participating in the relief scheme.
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