Corporate lending stock of Hungarian banks up in July

Telco

The corporate lending stock of Hungarian banks rose slightly from the previous month in July, as net corporate borrowing more than offset the reduction resulting from the strengthening of the forint and other revaluation effects, according to data published by state news agency MTI.

The corporate lending stock rose HUF 13.8 billion to HUF 6.230 trillion, including HUF 77 bln in the form of bonds, unadjusted data show. Transactions raised the lending stock by HUF 62.9 bln, while revaluations and other changes reduced it by HUF 49.1 bln, fresh data from the National Bank of Hungary (MNB) show.

The stock of forint loans rose HUF 73.8 bln because of transactions and the stock of foreign currency loans fell by HUF 9.7 bln in forint terms from one month earlier. Revaluations decreased the forint loan stock by HUF 1.8 bln and reduced the FX loan stock by HUF 45.4 bln in July. Excluding seasonal and revaluation effects, businesses borrowed HUF 34.9 bln in forint loans and repaid net HUF 9.7 bln of FX loans in July.

Holdings by credit institutions of bonds issued by non-financials decreased by HUF 1.3 bln due to transactions and fell HUF 1.8 bln on revaluation and other effects. Corporate deposits meanwhile fell by HUF 44.9 bln, mostly on the stronger forint, but also on forint withdrawals and placements in foreign currency, to HUF 6.661 tln at the end of July. Little more than two-thirds of the deposits were in forints.

Businesses withdrew HUF 165 bln from forint deposits and placed HUF 159.3 bln in FX deposits, while the strengthening of the forint cut the value of their FX deposits by more than HUF 37 bln. Excluding seasonal and revaluation effects, businesses reduced their forint deposits by HUF 34.9 bln and increased their FX deposits by HUF 137.8 bln in July.

The euro strengthened about 1.3% against the forint between the end of June and the end of July, calculating with the central bankʼs daily fixing.

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