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Number of Hungarian borrowers behind on repayments grows

The number of Hungarian companies included on a list of borrowers 30-90 days behind on repayments rose one third to 24,000 in the twelve months to the end of March, BISZ, which operates the Central Credit Information System (KHR), said in a newsletter.

The percentage of corporate borrowers behind on loan repayments rose to 4% from 2.5% during the period. The size of the loans signed for by these companies increased to HUF 758 billion from HUF 432 billion. Although part of the increase in absolute terms can be explained by the weaker forint, companies’ ability to make repayments is also a factor, considering about half of the loans were forint-based, BISZ said.

Loan volume of companies newly included on the list in Q1 was unchanged at HUF 170 billion.

The proportion of forint-based loans within total classified loan volume of companies on the list fell to around 50% from more than 60%. The proportion of foreign currency-based loans rose as the forint weakened and higher interest rates made repayments more difficult.

The proportion of forint- and foreign currency-based lending is about the same for the whole corporate lending portfolio, BISZ said concluding that that foreign currency loans has beared the increased risk well to date.

The number of retail borrowers behind on installments rose about 50% to more than 1 million in the twelve months to the end of March. This included 740,000 late payments still outstanding, again an increase of 50% in twelve months. The number of new inclusions on the list has stabilised at 75,000-95,000 per quarter, BISZ said.

Borrowers who fall more than HUF 71,500 - the monthly minimum wage - behind on loan payments for more than 90 days are included on the list. Borrowers remain on the list for a period of five years.

The BISZ list for companies includes figures on all loan contracts. Its register on retail loans is, in contrast, a blacklist. It includes retail borrowers who fall more than the monthly minimum wage - at present HUF 71,500 - behind on loan payments for more than 90 days are included on the list. Borrowers remain on the list for a period of five years. (MTI-ECONEWS)