MNB expands preferential capital requirement for green financing

MNB

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The National Bank of Hungary (MNB) yesterday said it expanded preferential capital requirements for green financing it rolled out earlier in the year, according to a release on its website.

The MNB earlier released part or all of Pillar 2 capital requirements for environmentally sustainable corporate and municipal exposures with the aim of boosting the share of sustainable industries in bank balance sheets.

Yesterday, the central bank and financial market watchdog said it would extend the capital allowance to financing for electromobility, including the purchase of fully electric vehicles, and for sustainable farm and food industry investments.

The MNB also decided to allow lenders to pool capital allowances to maximize their use, setting a cap at 1.5% of total risk exposure for banks active in green financing.

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