Value of new retail loan contracts drops after early FX repayment scheme winds up

MNB

The value of new loan contracts Hungarian banks signed with retail clients fell in March after swelling in the preceding months as borrowers availed of a government-initiated foreign currency-denominated mortgage repayment scheme at discounted exchange rates, fresh monthly data published by the National Bank of Hungary on Friday show.

The value of new home loan contracts signed in March came to HUF 11.6 billion, well under the HUF 37.2 billion in February, the HUF 61.4 billion in January and the HUF 40.6 billion in December. The value of new consumer loans was HUF 16.2 billion in March, down from HUF 36.9 billion in February, HUF 77.3 billion in January and HUF 74.4 billion in December.

Under the scheme, borrowers could make full repayment of their forex mortgages at discounts covered by lenders. During the run of the scheme, from the end of September until the end of February, households repaid HUF 1,315.0 billion of FX loans, data published earlier by the MNB show. Calculating for the exchange rate discount, they actually paid HUF 956.1 billion. Loans used to participate in the scheme came to HUF 298.1 billion.

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