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OTP Bank pays back rest of €1.4 billion state loan

OTP Bank on Monday said it paid back the equivalent of €700 million to the Hungarian state as the remaining part of a €1.4 billion loan it took out in March 2009, at the height of the financial crisis.

The bank was to start the repayment From February 2011 in eight equal tranches, but it prepaid the first half already in November 2009.

“At the time of the agreement it was the peak of the financial crisis and both the Ministry of Finance and OTP Bank set an aim of providing access funding sources for the Hungarian corporate sector. However, due to the conditions of the loan facility, namely the interest rate level and maturity, the bank could satisfy the demand of only a limited circle of entrepreneurs, thus OTP Bank decided to support a wider range of potential client interest at the expense of its own liquidity, exceeding €6 billion,” the bank said.

During 2009, OTP Bank lent HUF 248 billion to companies. As a result, its FX-adjusted loan portfolio for medium and big enterprises grew 8% and the SME portfolio grew 5%. In the year to date, OTP Bank has signed for HUF 34 billion of corporate loans. (MTI-ECONEWS)