Daily News Hungary

Budapest, October 17 (MTI) – Hungary’s National Deposit Insurance Fund (OBA) has paid out almost 90 billion forints (EUR 295m) to the clients of three failed savings cooperatives this year, up from 76.6 billion in 2013, business daily Vilaggazdasag said today.

If another bank goes bust and OBA runs out of money, the law allows it to borrow to compensate depositors, the paper said.

In such a situation, OBA would first turn to the National Bank of Hungary for credit, the fund’s communications director told the paper. The amount would have to be repaid within three months, thus OBA would tap the market for credit, said Istvan Toth.

At present, lenders pay 1 percent of the total deposits covered by OBA (the equivalent of EUR 100,000 per depositor), but the rate may be raised to 2 percent or 3 percent under the law.

Deposits covered by OBA at the end of last year came to 8,753 billion forints.

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

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