Coronavirus – Hungary central bank: Loan repayments may not rise after moratorium

The National Bank of Hungary (NBH) on Monday said lenders may not raise borrowers’ installments after a moratorium on repayments expires at year-end.

Hungary’s government recently declared a moratorium on payments of principal, interest and fees on all retail and corporate loans until the end of 2020. The measure is one of many rolled out to cushion the impact of novel coronavirus on the economy.

“The [NBH] expects financial institutions to offer solutions which ensure that the postponement of payments will not lead to an increase in debtors’ installments from the original after the payment moratorium ends.

This entails an extended maturity for most debtors which ensures that monthly burdens remain unchanged at the original level or below. As a result, repayment is not expected to cause difficulties for customers. In the Bank’s view, the above requirement helps to maintain the equilibrium between creditors’ and debtors’ interests in the current extraordinary situation,” the central bank said.