A provision of €272 mln was made for the compensation and booked on the “other results” line in the profit and loss statement , RBI said in its report.

Recent legislation requires all Hungarian lenders to compensate retail borrowers for using exchange rate margins when calculating repayments on foreign currency-denominated loans and for making unfair unilateral changes to both FX and forint loans.

RBI said that the net interest income of the Hungarian business fell 20.4% to €118m as a result of lower interest income from derivatives, reduced lending volumes and a lower market interest rate level. However there was an increase of 8.2% to €91 mln in net income from commissions and fees.

Net provisioning for impairment losses experienced a decline from €97 mln to €41 mln in the base period, attributable to both corporate and retail business, according to RBI. In Q3 alone, RBI booked a €202 mln loss on the Hungarian market. The compensation due under the borrowers’ relief legislation had a €205 mln impact on the bottom line. “The market environment in Hungary continues to be difficult and is currently under closer observation,” RBI said.