Moodyʼs changes outlook of multiple Hungarian banks to positive

The banksʼ Prime 3 short-term foreign currency deposit ratings have also been affirmed.

Concurrently, the rating agency has affirmed the Baa3 backed foreign currency long-term deposit and backed senior unsecured bond ratings of fully government-owned Hungarian development bank MFB and changed the outlook to positive from stable. MFBʼs P-3 backed short-term deposit ratings have also been affirmed.

The rating actions follow the recent affirmation and change of the outlook of the Hungarian governmentʼs Baa3 long-term issuer and senior unsecured debt ratings to positive from stable.

Moodyʼs says that the rating affirmation of the commercial banksʼ foreign-currency deposit ratings is driven by the affirmation of the sovereign rating at Baa3, leaving the foreign currency deposit ceilings unchanged. The long-term foreign currency deposit ratings of these banks are one or two notches below their local currency deposit ratings and remain capped by the foreign currency deposit ceiling for Hungary.

The agency adds that the affirmation of the deposit and issuer ratings of MFB reflect their alignment with the Hungarian governmentʼs ratings given the governmentʼs full ownership and direct, irrevocable, and unconditional guarantee of MFBʼs liabilities.