Raiffeisen to stay in Hungary despite tax blow

Banking

Hungary's abandonment of an agreement to halve its bank levy next year is a "low blow" to lenders, Raiffeisen Bank International Chief Executive Herbert Stepic said, but added the lender had no plans to leave the country.

He declined to tell reporters at an investment conference on Thursday how much the move would cost the Austrian bank, saying only it had paid 42 million euros ($55 million) in Hungarian bank tax in 2011.

Hungary opted on Wednesday to use tax hikes to avert European Union sanctions over its budget deficit, reopening policy differences with its international lenders and dimming prospects for a long-delayed financing deal.

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