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Establishment of farmers bank "unavoidable", says gov’t

Hungary's government on Friday reaffirmed its intention to establish a bank for farmers with the participation of the state.

State secretary for the Prime Minister's Office János Lázár said the establishment of such a bank was "unavoidable" as the Hungarian bank sector "does not wish to finance Hungarian agriculture activities", a conclusion reached after a review of banks' stand on the new farm land act.

The Hungarian Banking Association said in its stand, published late on Thursday, that the new farm land bill failed to sufficiently distinguish between land owners and those who farm land, which could make long-term financing difficult and raise lending risk.

The government submitted the bill on land legislation to Parliament just before the summer recess on July 12.