Brusselsʼ objections could result in changes to bank levy rules
Regulations governing the bank levy will probably have to be modified due to objections by the European Commission to two elements of the rules pertaining to Hungaryʼs agreement with the European Bank for Reconstruction and Development (EBRD), National Economy Minister Mihály Varga said at a conference today.
The EC has objected to a HUF 10 bln tax preference offered to banks to boost their lending activity during the global financial crisis, as well as a rule that allows deductions for losses by local lenders in Ukraine and Russia due to destabilization, Varga said at the conference organized by business daily Vilaggazdaság.
Under the agreement with the EBRD signed in February, Hungary committed to a reduction in the bank levy and said it would acquire a 15% stake in the local unit of Austriaʼs Erste bank.
Varga noted "uncertainty" on the part of Erste concerning the transaction, but said the government still wished to acquire the stake in Erste Bank Hungary.
"We did not sign an agreement in February with the EBRD and Erste that included the bank levy reduction from next year, to score points with banks, but to help boost lending by banks", said Varga.
The minister said economic growth in Hungary is happening without a real increase in lending but the government hopes that "a reduction in the bank levy will be matched by an increase in lending".
Varga stressed the importance of the ECʼs objections not having an impact on the deal between the EBRD and Erste.
Varga also noted that the state is not planning to sell its stake in Hungarian companies in the near future, including its shares in oil and gas company MOL and drugmaker Richter.
Richter Shareholders Approve HUF 423/Share Dividend
Liz & Chain Rooftop Bar Debuts Sustainable Cocktails
SUPPORT THE BUDAPEST BUSINESS JOURNAL
Producing journalism that is worthy of the name is a costly business. For 27 years, the publishers, editors and reporters of the Budapest Business Journal have striven to bring you business news that works, information that you can trust, that is factual, accurate and presented without fear or favor.
Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.
