A solution to the problems of Hungarians struggling to repay foreign currency-denominated loans must be favourable for the state, borrowers and banks, even if it creates losses for banks in the short term, government commissioner for financial rights György Doubravszky told a parliamentary committee on Monday.It is nobody's interest for the Hungarian banking system to falter from any point of view, Doubravszky said, adding that his proposed solution will be published on Monday. Hungarian households borrowed heavily in foreign currency when the forint was strong and FX loans were cheaper than forint ones. But the weaker forint raised repayments on the FX loans, causing the number of distressed borrowers to swell. Doubravszky told the committee that establishing a new, alternative banking system could support the renewal of Hungary's existing banking system. Doubravszky recently initiated talks between the government, civil associations and the Hungarian Banking Association to remedy the situation of FX borrowers. The banking association called the latest round of talks last Tuesday "unnecessary stalling" and declined to participate, saying its negotiators were "unprepared". In a statement released on Monday, Doubravszky said that if FX loans were understood to be foreign currency loans accounted as forint loans, they are "faulty products" for which lenders and regulators must bear responsibility. Doubravszky told the parliamentary committee that he was not proposing the conversion of FX loans into forint ones at current exchange rates as this would "sanction an unfair situation". He added that the starting point of his proposal would rather be that a number of costs, such as exchange rate margins, attached to FX loans should never have been charged to clients in the first place.