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Csányi: Top-up fund favors Quaestor clients

Issues

Recently approved legislation to set up a top-up fund to compensate clients of failed brokerage firm Quaestor may not pass the scrutiny of the Constitutional Court, OTP Bank chairman-CEO Sándor Csányi told the press following an annual general meeting of the lenderʼs shareholders, state news agency MTI reported on Friday. 

Csányi said the Constitutional Court could reject the law because it does not give equal treatment to clients of all failed brokerages. He also called into question the legality of extending the range of the Investor Protection Fund (Beva) retroactively and raising its compensation threshold.

Three brokerages have gone bankrupt in Hungary since February, but the special top-up fund, set up by parliament this week, covers Quaestor clients exclusively, while clients of Buda-Cash Brokerhouse and Hungaria Fund Managers are only being covered by Beva. Csányi said OTP is likely to have to pay HUF 57 bln of the Quaestor client compensation required by the law.

Questions have arisen over whether officials in the government had insider information about Quaestorʼs problems, but officials deny that charge.

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