MNB announces cost cuts and expanded management structure

The National Bank of Hungary (MNB) on Thursday announced cost-cutting measures and a new management structure. "On their first workday, the new management initiated an immediate, broad review of the central bank's operations in the interest of investigating legal violations uncovered in a recent probe by the State Audit Office (ÁSz)," the MNB's communications department said in a statement published on the central bank's website. The new management has initiated an immediate 25% reduction in the central bank's HUF 1 billion fund for paying staff bonuses. They also launched a 20% cut in operating costs to be implemented within two years. The central bank's management will be expanded to include five "managing directors" in addition to the governor and three deputy-governors. "The National Bank of Hungary's new governor does not agree with his predecessor, who introduced a single-person management system at the central bank," the MNB said. Former economy minister György Matolcsy was appointed MNB governor on March 4, replacing András Simor, whose mandate expired. Among the managing directors are Dániel Palotai, in charge of implementing monetary policy; Márton Nagy, in charge of financial stability and lending incentives; György Sándor, in charge of operations; and Norbert Csizmadia, in charge of fiscal coordination. The statement did not name a fifth managing director. It announced that Róza Nagy will be general director, and will ensure the central bank's operation is efficient and in line with the law. The appointments will take effect one day after the MNB's organisational and operational code (SzMSz) is published, the MNB's press department said. The "old" SzMSz, which took effect on March 29, 2012, is posted on the MNB's website. Nagy and Sándor already work in their respective areas at the MNB, Nagy as director in charge of financial stability and Sándor as managing director in charge of operations. Information on the government's website shows Ms Nagy as state secretary for public administration, Csizmadia as state secretary in charge of planning coordination and Palotai as head of the macroeconomic policy department of the National Economy Ministry. Palotai is also listed among the members of the MNB's supervisory board.