2-day bank holiday ordered for Sberbank Magyarország

Banking

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The National Bank of Hungary (MNB) on Monday said it ordered a two-day bank holiday at Sberbank Magyarország after the European Union's resolution organization said the lender's Russian-owned parent, Sberbank Europe, "experienced serious liquidity problems" as a result of the war in Ukraine, according to a report by state news wire MTI.

Hungary's central bank and financial market watchdog said the EU's Single Resolution Board (SRB) announced that Sberbank Europe, based in Austria, "is probably unable to meet its debts or other obligations as they fall due in the near future, and as a result it is failing or likely to fail".

MNB ordered the two-day bank holiday, from February 28 until March 1, at the request of Sberbank Magyarország.

During the period, MNB "will review the operation and condition of the Hungarian subsidiary in the current situation and make the most appropriate decision in terms of the stability of the financial markets and customer interests as soon as possible".

Sberbank Magyarország clients will be able to initiate bank card transactions and may receive account transfers, but they may not initiate account transactions.

MNB noted that Sberbank Magyarország's deposits are covered by the Hungarian National Deposit Insurance Fund (OBA).

"The current events have no effect on other members of the domestic financial system, which serve their customers safely and in the usual order," MNB said.

Sberbank Magyarország had total assets of HUF 511 billion at the end of 2020, public records show. Client deposits stood close to HUF 355 bln.

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