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Brussels clears MARK for operation

The European Commission has authorised the operation of the Hungarian Reorganisation and Receivables Management Company (MARK), established by the National Bank of Hungary (MNB) last November to buy bad commercial real estate loans and properties from banks, the central bank said today.

“Since MARK will purchase assets at market price, based on the validation of the European Commission, the planned asset acquisition program does not contain state aid,” the MNB said.

In a statement announcing its approval of MARK, the EC said it “concluded that the pricing models used by the Hungarian asset management company ensure it will buy non-performing loans at market prices”.

“If a Member State intervenes as a private investor would do and is remunerated for the risk assumed in a way a private investor would have accepted, then such interventions do not constitute state aid,” it explained.

The MNB said the ECʼs decision “marked the end of intense expert-level consultations that took nearly a year”.

MARK will announce the detailed terms and conditions of its asset purchase scheme in the second half of February, after receipt of the full, detailed EC resolution documentation, the MNB said. Participation in the asset purchase phase, which will last 15 months, is voluntary but open to all domestic financial institutions. MARK will make binding offers for all eligible portfolios for sale.

MARK was established late in 2014.