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MNB to hold LIRS tender on July 6

The National Bank of Hungary (MNB) said today it will hold a tender for interest rate swaps conditional on lending activity (LIRS) on July 6. The tender is part of the second phase of the central bankʼs Market-based Lending Scheme (MLS), state news agency MTI reported.

LIRS will be available for banks for no more than HUF 300 billion. The maturity of the instrument, corresponding to LIRS allocated in the first phase of the MLS, will be February 28, 2019.

Banks are expected to expand their commitment to raise SME lending. Currently they are committed to raise annual SME lending to HUF 170 bln.

The MNB will complement the LIRS by offering a preferential deposit facility with a cap of HUF 150 bln, available from August, for banks participating in the LIRS tender. Preference will be given to banks making bigger lending commitments.