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Development bank chief offers to resign

János Erős, CEO of the state-owned Hungarian Development Bank (MFB), offered to resign from his post at a press conference on Friday to make room for a successor that is "traditionally" picked by the government in power.

"The position of MFB CEO can be seen as an appointment by the country's current government, which traditionally names its own candidate. Thus I offer my the appropriate minister in the new government," Erős said.

Hungary's next government is expected to be formed in the second half of May.

Erős headed MFB between 2002 and 2010.

MFB had pre-tax profit of HUF 2.55 billion in 2009, over the target. The bank paid a HUF 12 billion dividend to the state from retained earnings and profit reserves.

Total assets rose to HUF 1,135.9 billion from HUF 1,027.8 billion in the twelve months to December 31, 2009. Stock of loans increased to HUF 823 billion from HUF 710 billion.

The bank had profit of HUF 1.8 billion in Q1 2010, in line with the target, Erős said.

First-quarter outlays came to HUF 33 billion, with local councils being the biggest recipients of loans. Forint and forex loans worth HUF 15 billion went to project loans.

MFB borrowed €100 million on the market - as it did not wish to borrow from the state - to finance maturing resources in Q1, and the finance minister approved the draw-down, in May, of a further €250 million to finance its lending activities.

The money will be enough to support the bank's lending activities for 1.5-2 years, Erős said.

MFB had lending resources over a year of €3.38 billion, or about HUF 929 billion. About 42% was bonds, 26% loans from development institutions, 17% owner loans, 13% securitized loans and 2% bilateral loans.

MFB has sufficient risk reserves and its liquidity position is strong, Erős said. (MTI-ECONEWS)