Economy minister understands, but does not share, criticism of FX mortgage repayment scheme

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National Economy Minister György Matolcsy on Tuesday said he understood, but did not share, criticism against the government's foreign currency-denominated mortgage repayment scheme.

Matolcsy told MTI he expected legislation implementing the plan to come before the Constitutional Court as well as the European Court. He added the government would decide on steps to take in response to decisions by the bodies when these decisions arrive.

Prime Minister Viktor Orbán told MPs in parliament on Monday that the government supports a proposal to allow Hungarians with foreign currency-denominated mortgages the chance to repay their loans in a single installment at a fixed exchange rate that is well under the market rate.

Matolcsy dismissed as false reports in the press that the Public Administration and Justice Ministry had said before the plan was announced that it would be illegal. The ministry said at a cabinet meeting that the plan was legally sound, he added.

Asked what Prime Minister Viktor Orbán meant when he said on Monday that the state "stands behind" OTP Bank and FHB, two big independent Hungarian lenders, Matolcsy said, "If they are in need of help, we will provide it".

Answering another question, Matolcsy said he had received a letter from Austrian Finance Minister Maria Fekter protesting the plan and was answering it, but he declined to reveal the content of the letter.

The government does not expect borrowers to convert their foreign currency-loans en masse as it is not mandatory for banks to offer clients forint loans to pay off their forex loans, he said.

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