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MNB sees sustainable lending growth ahead

Credit lending has restarted in Hungary, with corporate lending growing by 5-10%, while retail lending shows a sustainable annual growth rate of 3% - Gyula Pleschinger, a member of the Monetary Council of the National Bank of Hungary (MNB), told public radio.

Following the financial crisis in 2008, credit lending collapsed, recalled Pleschinger, cited by current affairs news portal hvg.hu. Since then, measures taken by the MNB have gradually led to an easing of lending conditions by banks, and corporate and retail credit has started to grow. Retail lending has also been supported by government home building programs, he noted.

In addition, the MNB has taken several measures to ensure financial stability, which have high chances of preventing a future financial or banking crisis. Over-indebtedness of the population is also unlikely, Pleschinger added.

This year the MNB expects GDP growth above 4%, although subsequent growth will slow to approximately the rate of the core EU countries, Pleschinger said. Average GDP growth in the EU is currently 2.5%, hvg.hu noted.