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Veres says there is a place for state intervention in private sector

  There is place for government intervention in the private sector when the state can more efficiently take steps in the interest of weathering the crisis, Finance Minister János Veres said at a conference organized by Hungarian investment association BAMOSZ and the DEMOS Foundation.

The goal of state support is to ensure the Hungarian economy is able to guard its productivity and return to the path of growth after the crisis, Veres said.

There is a place for the state in the bank sector, be it in risk management, product development or consumer protection, Hungarian Bank Association head Péter Felcsuti said at the conference. The state might even prohibit some products in certain situations.

At the same time, Felcsuti criticized an amendment that would change the conditions for unilateral modifications to bank-client contracts. The amendment is not well thought out, from a professional point of view, he said.

Veres warned that the public’s expectations of the state with regard to assisting Hungarians that are having trouble repaying their foreign currency-denominated loans are economically unreasonable. The budget is in no position to cover such a cost, he added.

Felcsuti stressed that the situation of Hungarian banks is unlike that of other banks directly affected by the subprime mortgage crisis. Unlike American banks, Hungarian banks never had any “toxic” assets, their capital adequacy ratios are higher than those of many Western European banks, and securitization of assets does not exist in Hungary, Felcsuti said. (MTI-Econews)