Are you sure?

Pécs local council approves agreement raising overdraft limit

The local council of Pécs (SW Hungary) approved on Thursday an agreement with OTP Bank to raise the city's overdraft limit from HUF 5 billion to HUF 7 billion. Council members had rejected the agreement in another vote at the end of November.

The agreement to raise the overdraft limit was signed by Zsolt Páva and OTP deputy CEO László Wolf on November 23.

Raising the limit was necessary to ensure the operation of the local council and strengthen its economic position, they said at the signing. Property owned by the local council was put up as collateral.

Mayor Zsolt Páva said earlier the city would avail of the new overdraft limit only if liquidity dried up. The agreement was designed to ensure that financing and organizing programs for 2010, when the city takes the European Capital of Culture title will not be a problem, he said.

The local council takes in about HUF 40 billion a year, not including support for European Capital of Culture projects, and it has about the same amount of debt, Páva said earlier. It has become more difficult to get credit in recent years, he added. (MTI-Econews)