Erste Bank Hungary Rt announced on Tuesday it will start offering state-subsidized individual retirement savings accounts from April 18.
Money in the accounts, also known by their Hungarian acronym NYESZ, may be invested in securities or shares offered by the bank's investment unit and fund manager, as well as shares listed on the Budapest Stock Exchange (BÉT) or other EU bourses. Account holders may not, however, invest in options and derivatives. The monthly fee for the account will be Ft 175 and the minimum deposit to open an account will be Ft 5,000.
Legislation establishing the accounts, which are subsidized by the state, came into effect at the start of 2006. The state will match 30% of annual contributions into the accounts up to Ft 100,000. Unlike other forms of state-subsidized pension savings schemes, savings in NYESZ accounts may be put in a number of different kinds of investments, including shares. So far, only HVB Bank Rt, MKB Bank Rt and Erste have offered NYESZ accounts.