FX Loan Conversion to Be Practically Mandatory, Says Govt Spokesman

Budapest, November 10 (MTI) – The conversion of retail foreign currency-denominated loans into forints will be practically mandatory for all borrowers, government spokesman Zoltan Kovacs said on Monday.

Banks will re-negotiate their contracts with all of the affected borrowers, Kovacs said. He noted that regulations in place since 2011 allow only borrowers with income in foreign currency to take out FX loans.

Economy Minister Mihaly Varga said earlier on Monday that he expects most Hungarian retail borrowers with foreign currency-denominated loans to opt to convert them into forints.

“Keeping foreign currency loans will have conditions,” Reuters quoted Varga as saying. “There I expect that the overwhelming majority of clients will opt for conversion,” he said.

Varga said borrowers would have 30 days after the legislation on the conversion comes into effect to opt out of the conversion.

The bill on the conversion is expected to be submitted to Parliament on Friday, he said.

Sandor Burany, the Socialist head of parliament’s budget committee, told MTI on Monday that, instead of resolving the problems of FX holders, Fidesz had created a new problem as the conversion of FX loans to forints at the current exchange rate would instantly and significantly increase monthly instalments for families.

Burany said that Varga should immediately resign as he had lied for the second time within a few days. After claiming that he had no information about tax office head Ildiko Vida being involved in a US entry ban, he said earlier on Monday that the conversion of FX loans to forints would not be mandatory, he said.

Photo: MTI – Noemi Bruzak

Source: http://mtva.hu/hu/hungary-matters