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Hungary wants details of ECB banking supervision plan before taking stand

Interview

Hungary wants clarification of details of a proposal to put the European Central Bank in charge of oversight of banks in the eurozone before formulating a stand on the matter, Márton Hajdú, spokesman of Hungary's permanent representative in Brussels told reporters on Wednesday.

Hungary wants to focus on the balance between rights and obligations, as well as the possible effects of the change, Hajdú said. Hungary intends to play a "constructive role" in the upcoming negotiations on the proposal, talks that are likely to be "very intense", he added. The plan affects Hungary as well as all non-eurozone countries with banks from the eurozone, he said. The impact will be especially significant in Hungary where the majority of banks are units or branches of eurozone banks.
EU Commissioner responsible for the internal market and services Michel Barnier conceded in the European Parliament on Wednesday, that the part of the proposal relating to non-eurozone countries was not sufficiently elaborated.
Enikő Győri, state secretary responsible for European Union affairs in Hungary's foreign affairs ministry, told Dow Jones Newswires in an interview on Wednesday that Hungary's decision on approving the proposal would be "based on whether obligations and rights arising from this new system are equal". "Our understanding after a quick reading is that they aren't," she added.
She said Hungary's main concerns are that the country's banks would not be provided with a potential bailout from the European mechanism in time of need, that its already very scarce liquidity would dry up further, and that locals may move their deposits to eurozone banks.
Győri said Hungary is coordinating views with regional peers Poland and the Czech Republic, as well as other non-eurozone members, ahead of the first official exchange on the proposal at an informal meeting of EU finance ministers at the weekend in Cyprus.

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