Borrowers sign contracts for HUF 125 bln of Green Home Program loans

Sustainability

Green Loan graphic by Denphumi / Shutterstock.com

Borrowers have signed close to 4,000 contracts for HUF 125 billion of loans in the framework of the Green Home Program of the National Bank of Hungary (MNB), the central bank's deputy governor Mihály Patai told state news wire MTI on Thursday.

In the framework of the Green Home Program, the central bank is providing 0pc refinancing to lenders for retail loans for new homes with a primary energy consumption threshold of 90 kWh/sqm per year. Interest rates on the loans are capped at 2.5%.

The initial allocation for the scheme has been set at HUF 200 bln, and MNB has divided the remaining HUF 75 bln among participating banks based on their activity up till now, Patai said.

Banks have reported outstanding interest in Green Home loans, so the Hungarian Banking Association has requested in writing that the program be continued, Patai said. The volume of applications submitted has already exceeded the program's budget, so the MNB's Monetary Council will discuss the possibility of continuing the program at its next meeting, he added.

Patai noted that some tightening in the terms and conditions of the loans should be expected. "Recent developments have shown that increasing energy efficiency will become even more important in the future," he said.

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