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Banking sector liquidity up in August

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The forint liquidity of Hungaryʼs banking sector rose in August from a month earlier, which was mainly reflected in an increase in the average stock of credit institutionsʼ overnight deposits, the National Bank of Hungary (MNB) said in a report yesterday based on preliminary data, state news agency MTI reported.

The average stock of overnight deposits of credit institutions rose by HUF 45.1 billion from July to August, to HUF 922.8 bln. At the same time, the average stock of the central bankʼs one-week loans to credit institutions rose by HUF 18.1 bln to HUF 22.6 bln in August.

The average stock of forint liquidity provided by the MNB to banks through EUR/HUF swaps rose HUF 76.2 bln to HUF 929 bln.

The MNBʼs average stock of external assets fell by HUF 117.7 bln to HUF 7.468 trillion. The stock of external assets stood at HUF 7.436 tln at the end of August, up from HUF 7.390 tln at the start of the month. Transactions increased the stock of external assets by HUF 57.7 bln, while revaluations and other factors cut it by HUF 11.8 bln.

The average stock of external assets fell primarily on the carry-over effect of the decline in foreign currency reserves at the end of July, the MNB reported without elaborating further.

The average stock of the central bankʼs foreign liabilities fell HUF 23.3 bln to HUF 827.5 bln, while the end-of-month stock fell HUF 31.9 bln to HUF 751.8 bln, both drops reflecting mainly the strengthening of the forint.

The stock of three-month deposits, the main sterilization instrument of the MNB, fell HUF 50 bln to HUF 450 bln at the end of August. The average stock was down HUF 14.5 bln at HUF 485.5 bln.

The average stock of central government deposits was down by HUF 72.7 bln to HUF 972.4 bln. The stock stood at HUF 1.085 tln at the end of the month, up HUF 14.2 bln from a month earlier.

The monthly average of the banking sectorʼs current account balances with the MNB exceeded the mandatory reserve requirement by HUF 11.8 bln, which was more than the usual excess. In August, reserve requirements totaled HUF 187.9 bln.

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