Supervisory board to investigate central bankʼs spending

Telco

Image by Jessica Fejos

The supervisory board of the National Bank of Hungary (MNB) on Friday decided it would launch investigations into the MNBʼs property purchases as well as the legality of creation of the bankʼs foundations, the MNB said on Friday. 

The board will inform the public of the findings once the investigations are completed, the announcement said. The MNB is expected to close this year with a profit after making a profit in the first half, president of the board Ferenc Papcsák said after the board discussed the bankʼs first-half performance at the Friday meeting.

That means the central budget will most probably not be required to make a transfer to top up the bankʼs reserves, Papcsák said. The MNB has been criticized by the opposition parties and several professionals for its large spending on property purchases and on the foundations it had created in the past two years. The MNBʼs executive board approved the launch of a HUF 90 bln property purchase and renovation program in December 2013.

The bank has has allocated HUF 200 bln into the so-called Pallas Athene foundations, a series of foundations it set up to support instruction in economics and finance in the past two years. President György Matolcsy said earlier the allocation was an endowment, with only the HUF 5-10 bln in annual yields to be spent on the foundationsʼ operations.

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