“The ECB welcomes the integration of [PSzÁF] into the [MNB], as this integrated institutional framework will improve the [MNB]’s ability to safeguard financial stability and prevent or mitigate systemic risks. In Member States with a relatively small financial market, such as Hungary, there are strong arguments for concentrating supervisory and macro-prudential responsibilities within a single authority,” the ECB said in the opinion. 

The ECB said entrusting the MNB with supervisory tasks is compatible with its membership in the European System of Central Banks, but noted that the new tasks should not affect the MNB’s “functional and financial independence” or the central bank’s performance of tasks related to the ESCB. The ECB added that draft legislation on the merger does not specify that the MNB’s new tasks fall under its exclusive competence.

Hungary’s government submitted a bill that would integrate the activities of PSzÁF with MNB on June 7. “The integration is an underlying condition for following and controlling system-level risks that threaten the stability of the financial system as a whole,” according to the bill’s justification. The bill would give the central bank the consumer protection and market oversight functions of PSzÁF in addition to oversight of money, capital and insurance markets. Antal Rogán, who chairs Parliament’s economy committee, said the final vote on the bill would not take place until the European Central Bank issues an opinion on the merger.