MNB issues recommendation on corporate NPLs
Image by Jessica Fejos
The National Bank of Hungary (MNB) said on Friday it has issued a recommendation for financial institutions on managing corporate debtors struggling with loan repayments, to prevent the future build-up of non-performing corporate loans, according to state news wire MTI.
The MNB is urging banks to seek compromises with corporate borrowers and offer opportunities to restructure loans to ensure the continuous operation of said companies and a reduction in NPL volumes.
The central bank said the volume of non-performing corporate loans currently stands at around HUF 600 billion.
The MNB recommendation sets out the minimum requirements for banks on communication, setting payment deadlines, providing bridge funding and seeking cooperation with borrowers, the MTI report adds.
The central bank expects financial institutions to start applying its recommendations from November 27. The MNB held consultations on the recommendation with advocacy groups and the European Bank for Reconstruction and Development (EBRD), MTI noted.
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