MNB: Banking sector liquidity grows in February

Telco

Photo by Jessica Fejos

The forint liquidity of Hungaryʼs banking sector rose in February from the previous month, as was witnessed in a drop of the combined rise of the National Bank of Hungaryʼs (MNB) sterilization instruments, data released by the central bank today show, according to Hungarian news agency MTI.

Central bank foreign assets were raised by anpreviously decided IMF quota increase that took effect on February 2. The increase did not affect the level of international reserves which rose between the end of January and February mainly due to transfers arriving from the European Union.

Average monthly stock of the three-month central bank deposit, introduced as the main sterilization instrument in the autumn of 2015, rose HUF 41.2 billion to HUF 3.057 trillion. At the same time, stock of the two-week deposit instrument, which the MNB plans to phase out by April, fell by HUF 55.8 bln to HUF 895.7 bln.

The rise in the average stock of banksʼ overnight deposits, by HUF 38.8 bln to HUF 147 bln, more than offset the combined drop of the three-month and the two-week deposits.

The average stock of money in circulation fell HUF 28 bln to HUF 4.282 tln.

The stock of central government deposits averaged HUF 1.221 tln, up HUF 82.2 bln, after dropping more than HUF 780 bln in December and January. The rise mainly reflected FX deposit placements by the Government Debt Management Agency (ÁKK), the MNB said.

Central government deposits fell HUF 144.1 bln, due to transactions, to HUF 1.352 tln at the end of February. The drop came after a HUF 836 bln rise in January that offset the bigger part of a more than HUF 1.40 tln plunge from the end of November to the end December.

Central government deposits usually fall around the end of the year as the government debt manager tends to reduce these in a bid to keep gross state debt on a declining trend, as required by both EU rules and Hungaryʼs Constitution.

Average foreign assets, including the central bankʼs international reserves, rose HUF 218.1 bln to HUF 10.331 tln in February. The rise reflected a SDR 901.6 million (HUF 354 bln) increase in Hungaryʼs IMF quota to SDR 1.94 mln on February 2. In line with IMF rules, 25% of the quota increase was met in SDR or in IMF reserve currencies, affecting the composition, though not the level, of foreign exchange reserves. The remaining 75%, paid in forints, raised foreign assets but is not part of the international reserves.  

Foreign assets stood at HUF 10.464 tln at the end of February, up HUF 343.6 bln in a month. About HUF 300 bln of the increase was due to transactions, primarily transfers from the EU, the bank said.

Foreign liabilities of the MNB rose on average HUF 293.6 bln to HUF 819.2 bln and were up HUF 290.7 bln in an end-of-month comparison in February, mainly in connection with the IMF quota increase.

The monthly average of the banking sectorʼs current account balances with the MNB exceeded reserve requirements by a slight HUF 2.1 bln compared to the total reserve requirement of HUF 360.6 bln. 

ADVERTISEMENT

Job ads in hospitality, tourism sector grow drastically  Analysis

Job ads in hospitality, tourism sector grow drastically 

Lawmakers approve 2022 budget Parliament

Lawmakers approve 2022 budget

Duncan Graham reelected as BCCH president Appointments

Duncan Graham reelected as BCCH president

Budapest launches revamped coupon card for visitors City

Budapest launches revamped coupon card for visitors

SUPPORT THE BUDAPEST BUSINESS JOURNAL

Producing journalism that is worthy of the name is a costly business. For 27 years, the publishers, editors and reporters of the Budapest Business Journal have striven to bring you business news that works, information that you can trust, that is factual, accurate and presented without fear or favor.
Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.