BBJ: MBH Bank announced its “Bank of Sustainable Future” program late last year. What is this?

András Puskás: At the Budapest Climate Summit 2023 international conference last year on Dec. 4, we announced our comprehensive ESG framework program, which spans several years. Through this initiative, we aim to support Hungary’s climate goals and decarbonization efforts in the coming years through three key commitments. The first focuses on conserving biodiversity in collaboration with the Ministry of Agriculture and the National Parks. We have begun developing biodiversity conservation programs that will allow our bank to contribute to maintaining a healthy ecosystem. For our second commitment, we have set the goal of achieving decarbonization targets, with the first step being that our bank will become a signatory to the Science Based Targets Initiative. Lastly, the third commitment outlined in the program focuses on boosting green lending by introducing green financial products.

BBJ: A pivotal program element is a cooperation agreement MBH Bank signed with the Ministry of Agriculture. What is the significance of this, and what are its goals?

AP: As a bank that is entirely Hungarian-owned and a key player in the domestic economic sphere, it was essential for us to create a program that would allow us to focus on supporting Hungary’s sustainability goals, with a significant emphasis on preserving our country’s green values. Therefore, it is of great importance to us that we can work with the Ministry of Agriculture and the Hungarian National Parks to protect the country’s green habitats and wildlife. Through this collaboration, we are providing HUF 30 million in support to the National Parks, which will be used to finance jointly determined programs to address specific problems and challenges faced by individual National Parks.

BBJ: How has the support of the 10 Hungarian national parks in Hungary developed this year? What joint projects have been launched?

AP: This year, we have already begun active collaboration with the National Parks, during which we first identified unique issues affecting the various areas. Based on this, we determined how to involve our colleagues in finding solutions to the challenges. For example, in cooperation with the Bükk National Park, many of our employees will contribute to its renewal. As part of a team-building day, our employees can participate in the establishment and renovation of the Szinva nature trail stations, as well as in a litter collection initiative. Additionally, we support the Wildcat Protection Project, assist in implementing a solar-powered water replenishment system in the Duna-Tisza region, and back a program to increase the breeding success and species protection of terns.

BBJ: MBH Bank became the first Hungarian-owned bank to sign up to the internationally recognized Science Based Targets Initiative this year. What did this entail, and what has it revealed about your operations?

AP: Our bank placed significant emphasis on ensuring that our decarbonization efforts were given adequate attention right from the outset when developing our ESG strategy. As part of this, we have launched our Net Zero Banking project in recent years. Under this, not only have we calculated our own and indirect greenhouse gas emissions, but we also aim to be the first Hungarian-owned bank to disclose the emissions of our financed portfolio publicly. This is part of our commitment to becoming an institution with near-zero emissions. Our efforts are supported by our membership in the Science Based Targets Initiative, which allows us to have our carbon dioxide reduction targets internationally validated scientifically and offers further assistance in reducing our emissions.

BBJ: MBH Bank is committed to increasing the share of green loans by at least four percentage points by the end of this year through a green product development program. How is this progressing?

AP: We have made significant progress in our green product development. As part of our Sustainable Future Bank program, we’ve introduced new green loan products and account packages focused on sustainability, biodiversity, and energy efficiency. Our entire banking group actively contributes, continuously launching new green products like green mortgages and funds.

BBJ: The MBH ESG Fund family includes the renewed MBH Greening Companies Equity Fund and MBH ESG New Energy Equity Fund, and the new MBH ESG Global Equity Fund. What are their aims, and how successful are they proving?

AP: We are aware that, for conscious investors, we must not only provide opportunities for achieving competitive returns but also address ESG considerations. In this spirit, we have designed our revamped funds with the goal that their success benefits not only the individual investor but also our global environment. The aforementioned funds focus on various aspects of sustainability, allowing every investor to find the most ideal and favorable structure for their needs. Some focus on sectors like energy and real estate, while others target leading renewable energy firms or companies adhering to ESG principles worldwide.

BBJ: The bank also has plans to issue green bonds. Where do you stand with this?

AP: MBH Bank’s green bond issuance is still in the preparatory phase. Currently, we are aligning with EU green certification requirements and developing the necessary frameworks and standards. Through this bond issuance, our bank aims to establish a strong position in the green loan and bond market, thereby contributing to supporting and achieving domestic and international sustainability goals.

BBJ: Finally, in December 2023, MBH Bank was the main sponsor of the Budapest Climate Summit. Why was this, and do you plan to repeat that backing this year?

AP: By supporting last year’s Budapest Climate Summit, we aimed to highlight MBH Bank’s commitment to sustainability and engage in the international discourse on building a green future. The event allowed us to showcase how financial tools, such as green loans and bonds, can help combat climate change. Our commitment to sustainability remains strong, and we look forward to supporting similar initiatives.

This article was first published in the Budapest Business Journal print issue of September 6, 2024.