finance

Hungarian finance minister highlights growing economic ties with Georgia in Tbilisi meeting

Finance Minister Mihaly Varga met with his Georgian counterpart, Lasha Khutsishvili, in Tbilisi, his ministry said on Tuesday.

The minister noted that bilateral economic relations are strengthened by the fact that in recent years, agreements on the avoidance of double taxation, the facilitation of customs procedures, the cooperation between tax authorities and the exchange of experiences were concluded.

Hungarian companies are entering the market in Georgia with increasing success, mostly supplying pharmaceutical, vehicle and machinery products, he added.

During the meeting, Varga noted that bilateral trade had increased by 12pc and Hungarian exports by 17pc in the first eight months of the year.

Varga said Georgia is also interested in Hungarian experiences in cracking down on tax evasion and debt management.

Within the framework of a cooperation agreement on e-taxation signed last year, Hungary is helping the development of the Georgian tax system with its experiences with pre-filled personal income tax returns and innovations related to online cash registers and vehicle taxes, he added.

Nagy: Hungary supports Georgia’s EU aspirations and expanding economic cooperation

National Economy Minister Márton Nagy met with Georgian Vice Prime Minister and Minister of Economy and Sustainable Development Levan Davitashvili, in Tbilisi, his ministry said on Tuesday.

Nagy expressed his congratulations on the victory of the ruling party in the Georgian parliamentary elections. During the meeting the ministers reviewed the global economic trends and bilateral economic relations.

The sides agreed that cooperation between Hungary and Georgia has steadily developed in recent years, including in the energy, pharmaceutical and food industry sectors.

Nagy noted that Georgia is Hungary’s 74th largest trade partner, bilateral trade volume has increased by 12pc so far this year and the government wants to further increase the trade in goods.

The strengthening of economic cooperation with Georgia is an opportunity not only for Hungary, but also for the EU as a whole. Therefore, Hungary continues to support Georgia’s EU integration efforts. Hungary strives for cooperation with everyone based on mutual respect, further strengthening the role of our country as a bridge where Western and Eastern capital and technology are connected, he added.

Read also:

Orbán cabinet: Hungary congratulates Georgian Dream party on election win

October 29, 2024

National Bank of Hungary: Maintaining banks’ strong capital position ‘pivotal

The National Bank of Hungary (NBH) acknowledged a reduction in overheating risks, in spite of the gradual lending recovery, but said maintaining banks’ strong capital position was “pivotal” amid still high geopolitical and macroeconomic uncertainty in a report published on Monday.

National Bank of Hungary shows a reduction in overheating risks

In its fresh Macroprudential Report, the central bank and financial market watchdog said indicators assessed to determine the Countercyclical Capital Buffer rate pointed to a reduction in the risks associated with overheating, but insisted on the need for a build-up of releasable capital buffers in a timely manner.

The NBH noted that the Countercyclical Capital Buffer rate would rise from 0.5pc to 1pc from July 1, 2025, even in a neutral risk environment. It added that the strong capital position and “outstanding profitability” of banks would mute any negative impact on the lending capacity of the banking system.

Lenders continue to comply with macroprudential financing rules with appropriate capital buffers and a favourable funding structure, the NBH said. The ratio of short-term debt on the banking sector’s balance sheet remains low, it added.

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October 29, 2024

Survey assesses Hungarians’ financial health, and the results are far from encouraging

huf forint money hungary's economy wage financial health

The National Bank of Hungary revealed the results of its inaugural survey on Hungarians’ financial health on Thursday.

The survey, which defined financial health as a feeling of financial security as well as the freedom to make one’s own financial decisions in the present and in planning for the future, was conducted among a representative sample of 1,500 people between the ages of 18 and 79 in August. Based on the results, the NHB rated Hungarians’ financial health on a scale of 0 to 100.

On average, Hungarians scored 53 on the NBH’s Financial Health Index, but 14pc were in the “critical” range, between 0 and 29, and 29pc were “vulnerable”, scoring between 30 and 49. The NBH noted that more than half of the households in those at-risk categories had net incomes under HUF 400,000/month. Around 35pc of Hungarians were in the “low-risk” category, scoring 50-69. Among the Financial Health Index sub-indices, Hungarians scored 48 for “ability and effort to make savings”, 56 on the gauge of material position and 49 for “financial resilience”.

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October 24, 2024

Hungarian finance minister calls for bigger role of development banks in crisis management at G20 meeting

finance minister mihály varga development banks g20 (1)

Finance Minister Mihály Varga said international development banks needed to play a bigger role in managing crises after a meeting of the finance ministers and central bank governors of the G20 in Washington, D.C. in a statement released by his ministry on Thursday.

Varga, who represented the presidency of the Council of the European Union at the meeting, said the G20 finance ministers and central bank governors had approved the rollout of a three-pillar proposal on enhancing international development banks.

Outlining the pillars of the proposal, he said multilateral development banks needed to expand their financing capacity while ensuring their long-term financial sustainability. They must also make their financing and consulting services more accessible while stepping up the mobilisation of private capital and national resources. The third pillar focuses on increased efficiency by boosting geographical distribution and improving knowledge of local needs, he added.

The participants also discussed challenges facing the global financial sector. Varga noted that international financial systems had proven resilient even when financial stability was under threat during the pandemic and after the outbreak of the war in Ukraine. That stability can be preserved with the help of the development of cross-border payments, regulation of digital innovations and financial integration, he added. He said the G20 was committed to developing a framework for the use of cryptocurrencies.

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October 24, 2024

House frozen in time: Inside Pest County’s abandoned modern villa

An abandoned modern villa in Pest County recently captured the Hungarian urbex community’s attention. Many are curious to find out what forced this unique architectural gem’s owners to leave such an astonishing home to decay for eternity. The books and kitchen supplies left behind suggest that the family had to leave in a rush. Curious explorers ventured inside and found some papers that provided a possible background story of the luxurious villa covered in dust.

Abandoned villa in Pest County

As Pénzcentrum writes, urban exploration, or “urbex”, has grown into a popular movement centred on discovering and documenting forgotten, abandoned spaces. From decaying industrial complexes to forgotten homes, the allure of exploring these neglected sites lies in their eerie beauty and untold stories. In Pest County, one such discovery has captivated the Hungarian urbex community—a modern villa, abandoned yet half-furnished, standing as a ghostly reminder of a different time. With its striking architecture and luxurious touches still intact, this villa in Pest County once embodied wealth and success, but now it quietly decays, its grandeur slowly fading.

What happened?

This derelict villa in Pest County tells a broader story of Hungary’s housing crisis, a reflection of the economic hardships faced by many homeowners. According to documents found inside the villa, the owners took out a substantial loan of HUF 160 million (EUR 399,476) in 2011. Of course, we cannot be a hundred percent sure about what happened, but the economic context and the papers strongly suggest that the family could not keep up with paying back the loan.

Once a symbol of affluence, the villa now lies empty, much like other luxury estates that have met similar fates in recent years. As urban explorers wander its halls, the villa’s past echoes through its empty rooms—a forgotten dream left behind, caught in the quiet aftermath of financial ruin.

Urbex’s growing popularity

Urban exploration is not merely about visiting abandoned places; it is a form of cultural documentation that reflects societal changes and historical narratives. Each site holds layers of meaning—stories of families who lived there, economic shifts that led to abandonment, and even architectural styles that tell us about past trends. The villa in Pest County serves as a microcosm of these larger themes, inviting explorers to ponder not just what was lost but also what can be learned from these spaces. The shared interest in photography, history and adventure (of course) brings together these communities, thus it is also an opportunity to meet like-minded people.

Unique places left behind

In another post of spiral urbex, they share another example of neglect within urban landscapes, fire trucks lie abandoned in the yard of a fire station. Plans were once set in motion for their recovery; they were intended to be restored and displayed in a museum dedicated to fire service history. However, due to persistent funding shortages, these plans never materialised, leaving these vehicles exposed and vulnerable for years.

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October 22, 2024

Expat Health Insurance in Puerto Rico Guide

Sponsored content

Moving to Puerto Rico is a mix of culture and nature. But, getting good healthcare is key for expats. The health system in Puerto Rico can be tricky, with public and private options and rules from the Office of the Commissioner of Insurance of Puerto Rico.

Understanding the local regulations and healthcare system is essential for expats in Puerto Rico. Joining expat forums and reading relevant publications can provide valuable insights. This guide will help you navigate puerto rico expat health insurance, explaining why having comprehensive health coverage is vital for a worry-free life on this beautiful island.

Understanding the Puerto Rican Healthcare System

For expats, knowing the Puerto Rico healthcare system is key. It has public health services and private medical facilities. This gives you choices based on what you need and want.

Public vs. Private Healthcare: What’s the Difference?

The system in Puerto Rico has two parts: public and private. Public services are cheaper but might take longer and have fewer resources. Private facilities offer quicker care and the latest technology, but cost more.

Expats can pick based on their budget, how urgent their care is, and what kind of experience they want.

Quality of Care in Puerto Rico

Healthcare in Puerto Rico is as good as in the US. Many places are accredited and meet high standards. People are happy with the care they get, whether it’s public or private.

Expats will find skilled doctors and staff in many specialties. They provide top-notch treatment.

Navigating the Language Barrier in Healthcare

Even though Spanish is common, many healthcare providers speak English. This is especially true in private facilities. Bilingual staff and interpreters help ensure communication is clear for everyone.

Puerto Rico Expat Health Insurance Options

Expats moving to Puerto Rico need to pick a good health insurance plan. There are many options, from global plans to local ones. Each plan has its own benefits, depending on your health needs and lifestyle.

International health insurance is great for those who travel a lot. It covers you worldwide and includes emergency services. Companies like Cigna Global and Aetna International are known for their good coverage.

Local health insurance in Puerto Rico is more affordable. It fits well with the island’s healthcare system. Triple-S Salud and MCS Healthcare are popular among locals and expats alike.

When choosing a plan, think about the health risks in Puerto Rico. It’s important to know what your plan covers and what it doesn’t. Talking to insurance agents can help you understand your options better. This way, you can choose the best plan for your health needs.

Disclaimer: the author(s) of the sponsored article(s) are solely responsible for any opinions expressed or offers made. These opinions do not necessarily reflect the official position of Daily News Hungary, and the editorial staff cannot be held responsible for their veracity.

October 20, 2024

Hungarian branch of Revolut opening postponed, MNB worried

revolut fintech company hungarian branch

Hungarian clients of fintech company Revolut “deserve a domestic bank”, the National Bank of Hungary (NBH) said on Thursday.

The central bank and financial market regulator pointed to foot-dragging on the launch of a local Revolut branch, but said a branch still wouldn’t be covered by the National Deposit Insurance Fund (OBA).

“A reassuring solution would be for the company to operate with a Hungarian subsidiary…sufficiently capitalised and with a deposit guarantee from OBA,” it said.

The NBH noted that around 1.5m Hungarians had accounts with Revolut — registered as a bank in Lithuania — and that number was set to reach 2m next year.

Read also:

Good news for customers: Revolut elevates its presence in Hungary

Featured image: depositphotos.com

October 17, 2024

Revolut’s Hungarian expansion: Hiring in progress for local branch

Revolut, one of the world’s fastest-growing fintech companies, is taking concrete steps towards establishing a branch in Hungary. With over 1.5 million users already in the country, the company is now actively seeking professionals to build its local workforce, signalling a strong commitment to expanding its presence in the Hungarian market.

The expansion is official

For some time, Revolut has been delivering its services to Hungarian users from abroad. However, that is about to change as the company is now in the process of setting up a local office. The news was initially hinted at by Antoine Le Nel, Revolut’s Growth and Marketing Director, back in August 2023, and the company’s plans have now progressed further. According to a report by Revb.hu, the fintech company is currently recruiting staff for key roles in its future Hungarian branch. Positions like Legal Counsel and Regulatory Compliance Manager are being advertised on LinkedIn, and the company is on the lookout for skilled experts with significant experience in these fields.

Balázs Györffy, Revolut’s Manager of Expansion, also confirmed these developments on social media, stating that the company is working at full speed to establish its branch in Hungary. This move is part of the company’s broader global expansion, which includes efforts to enter other key markets, such as India.

Why a branch, not a subsidiary?

Revolut has clarified that they are opening a branch in Hungary, not a subsidiary. This strategic choice means that the company will not apply for a Hungarian banking license. Instead, the services provided to Hungarian customers will continue to operate under Revolut’s Lithuanian banking license. As a result, customer deposits will still be insured through Lithuania’s deposit protection scheme.

That said, opening a local branch will bring specific advantages for Hungarian users. For instance, Revolut plans to offer Hungarian IBAN numbers, simplifying salary transfers and local transactions. This could also enhance access to immediate domestic transfers, something currently limited by the international nature of Revolut’s operations. Additionally, the company will be providing Hungarian-speaking customer service, replacing the existing international support team.

Navigating regulatory challenges

revolut card payment — Photo: depositphotos.com

In the past, the Hungarian National Bank had encouraged Revolut to establish a subsidiary, which would have allowed the company to join Hungary’s National Deposit Insurance Fund. However, the fintech company chose not to pursue this option, citing it as a strategic decision. Tamás Léder, Revolut’s Hungarian country manager, explained that while the company decided against becoming a subsidiary, they are fully committed to growing their operations in the country.

The company has been handling the Hungarian government’s evolving tax and fee structure, including the recent introduction of transaction taxes on currency exchanges. Since October 2024, conversions have been subject to a higher levy. Despite these regulatory changes, Revolut has continued to absorb these costs rather than passing them onto customers, though this may not be sustainable in the long term.

What does this mean for customers?

The establishment of a local branch is a significant step forward for Revolut’s users in Hungary. In addition to Hungarian IBAN numbers, customers will benefit from faster and more efficient transactions, especially when dealing with local banks. This will particularly help the many Hungarians who already use Revolut to receive their salaries. The current process, which involves transferring funds to a Lithuanian account, can result in delays and additional fees. Hungarian IBAN numbers will solve these issues, making Revolut a more viable option as a primary bank account for many users.

Furthermore, the new branch will provide local customer support, improving the user experience and offering more direct solutions for handling complaints and queries. This level of localised service is expected to increase the company’s popularity and user base in Hungary, which it aims to grow to 2 million by 2025.

Read also:

Featured image: depositphotos.com

October 9, 2024

Is Revolut opening a branch in Hungary?

Hungary’s Minister for the National Economy, Márton Nagy, met with executives from Revolut Bank at his office in Budapest on Thursday, sparking speculation about the topics discussed during the meeting.

Nagy meets Revolut CEO

According to MTI, Márton Nagy held talks with Revolut Bank’s CEO, Joseph Heneghan, Deputy CEO, Vytautas Danta, and Tamás Léder, the managing director of the financial services provider’s Hungarian unit. At the meeting, Nagy emphasised the importance of digitalisation for the future of Hungary’s financial services but underscored that consumers and consumer protection remain the top priorities. He added that the bank is expected to operate in a transparent manner, comply with all regulations, and fulfil its tax obligations. Revolut currently has over 45 million users globally, including 1.5 million in Hungary.

Revolut branch in Hungary

As reported by Mfor, Revolut, with its 1.5 million customers in Hungary, currently operates without a local branch but is considering establishing one. The Hungarian National Bank (MNB) has raised concerns about the difficulties of supervising the service and safeguarding customer interests when it operates solely as a cross-border service. The MNB prefers the establishment of a Hungarian subsidiary rather than a branch, as this would provide greater protection to customers through domestic deposit insurance, rather than relying on Lithuanian coverage.

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September 12, 2024

Did Orbán accidentally reveal the new Governor of the National Bank of Hungary?

György Matolcsy’s second term as Governor of the National Bank of Hungary is set to conclude in spring 2025, prompting the need to find his successor. Prime Minister Viktor Orbán has dropped hints, pointing towards two ministers. So, who will be the next Governor of the National Bank of Hungary?

The clock is ticking

As Világgazdaság reports, Hungarian Prime Minister Viktor Orbán has hinted at an impending decision regarding the next Governor of the National Bank of Hungary (MNB). With György Matolcsy’s second term set to end in spring 2025 and legal restrictions preventing him from serving a third term, speculation about his successor has been mounting. Orbán suggested on social media that a decision on Matolcsy’s replacement was imminent, bringing the country closer to discovering who will be the next head of the MNB.

Criticism towards the current Governor of the National Bank of Hungary

In a recent Facebook post, Viktor Orbán shared key insights from a private speech delivered at the Dobozy mansion. He revealed a new economic plan, termed the “peace budget”, aimed at achieving 3-5% economic growth by 2025 while maintaining fiscal balance. Orbán highlighted wage dynamics, the need to increase family allowances in response to inflation, and a small business programme reminiscent of the Széchenyi Plan. He also directed sharp criticism at the current Governor of the National Bank of Hungary, György Matolcsy, suggesting that he has not been supportive of the government’s fiscal policies.

Hungarian National Bank György Matolcsy hungarian government — Photo: facebook.com/jegybank

Who will be Matolcsy’s successor?

Prime Minister Viktor Orbán hinted at significant changes to Hungary’s economic governance, referencing Ludwig Erhard, the German Chancellor renowned for his role in post-war economic recovery. Orbán suggested that Hungary needs its own Erhard—a senior minister with control over both economic and budgetary tools. He hinted that Márton Nagy, who is currently overseeing economic affairs, could take on this enhanced role. Meanwhile, Orbán implied that Mihály Varga, the current Finance Minister, might be appointed as the new Governor of the National Bank of Hungary in March 2025. This potential restructuring could see the Ministry of Finance and the Ministry of National Economy merged, reflecting a model used in previous Orbán administrations. It should be noted, however, that Mihály Varga has dismissed the rumours of his appointment as “fake news”.

Mihály Varga finance minister public debt g20 — Photo: FB/Mihály Varga

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September 9, 2024

Will the Budapest meeting of eurozone finance ministers be boycotted?

pm viktor orbán azerbaijan Excessive deficit procedure

A meeting of eurozone finance ministers scheduled for 13 September in Budapest may be cancelled, following a decision by Irish Public Expenditure Minister, Paschal Donohoe, who is set to lead the session.

Budapest meeting of eurozone finance ministers at risk

Politico reports that the upcoming Eurogroup meeting of eurozone finance ministers in Budapest on 13 September is at risk of cancellation due to growing discontent over Hungary‘s close ties with Russia. Paschal Donohoe, the Irish Public Expenditure Minister and head of the gathering, will decide by next week whether to proceed, as some ministers, including those from Germany, Estonia, Finland, and Lithuania, have signalled their intention to boycott. The European Commission has also withdrawn its participation from meetings during Hungary’s EU presidency. The decision on whether to cancel the meeting may depend on discussions at upcoming talks in Brussels.

Hungarian Ministry of Finance reacts

However, Telex notes that despite these concerns, the meeting of eurozone finance ministers remains officially on the agenda, as confirmed by a Eurogroup spokesperson. When contacted by ATV, the Ministry of Finance did not comment on this particular meeting, instead referencing a different upcoming EU finance ministers’ meeting. The Ministry stated:

The Ministry of Finance is currently working on preparations for the September meeting in Budapest. In addition to the central bank governors, the two-day high-level meeting will be attended by the Managing Directors of the IMF, the Presidents of the EBRD and the EIB, and the Secretary General of the OECD, among others.

The Hungarian Finance Minister added:

In recent years, Europe has fallen significantly behind its competitors, and the Hungarian Presidency aims to restore the EU’s competitiveness. The Hungarian position is that there is no room for ideological and political debates in this work; we must work together on the challenges facing the EU.

Photo: FB/Mihály Varga

Not the first boycott and probably not the last

The potential boycott of the Budapest meeting of eurozone finance ministers is not the first instance of EU member states boycotting meetings in Budapest during Hungary’s EU presidency. Germany, Sweden, Finland, Poland, and the Baltic states—Estonia, Latvia, and Lithuania—have all announced plans to skip informal meetings during Hungary’s six-month presidency. In July, several EU finance ministers publicly criticised Hungarian Prime Minister Viktor Orbán for meeting with Russian President Vladimir Putin rather than prioritising aid to Ukraine. Orbán’s recent visits to Russia and China, without prior coordination with EU leaders, have further unsettled member states and left EU politicians fuming.

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September 2, 2024

Are Hungarians wealthier than expected? Many moving their money abroad

Are Hungarians wealthier than expected? forint money

Global wealth began to rise again last year, with Hungary witnessing an increase of over 200% in average wealth per adult since the financial crisis. However, premium banking clients are now seeking to move their assets abroad in search of more favourable transaction fees. This trend could threaten cash flows and the broader Hungarian economy. Meanwhile, foreign currency loans are reaching record levels.

International trends and Hungary

As Portfolio writes, global wealth resumed its growth last year, with lower-income adults in Hungary experiencing faster growth in wealth than those in higher brackets, according to a recent UBS study. Despite this, Hungary saw an 8% decline in average wealth per adult in 2023 when measured in Hungarian forints. Yet, since the 2008 financial crisis, average wealth per adult in Hungary has more than tripled, ranking it eighth globally in terms of growth. The study also highlighted a significant disparity between average and median wealth, a pattern evident in Hungary.

Hungarians seek to move their fortunes abroad

According to Szeretlek Magyarország, the recent introduction of financial transaction levies and additional charges for currency conversion in Hungary is unlikely to drive the wealthy to move all their assets abroad. However, 10-30% of their actively managed savings may be relocated to foreign providers, as reported by hvg.hu based on Blochamps Capital’s analysis.

The National Bank of Hungary (MNB) has observed a significant shift, with financial institution deposits falling by nearly HUF 1,200 billion (EUR 3 million) in July, while foreign currency deposits rose by HUF 492 billion (EUR 1.25 million). This shift is directly linked to the new measures, particularly affecting premium banking and affluent clients, who may find the extra 0.9% transaction fee a more significant burden. Consequently, there is growing interest among these clients in opening foreign accounts, particularly with banks offering international networks.

Why is this a problem?

István Karagich, the managing director of Blochamps Capital, warns that while it is unlikely that a significant portion of Hungary’s wealthy will move their entire wealth abroad, the relocation of 10-30% of their regularly invested assets to foreign providers could pose serious risks. Such a shift could reduce cash flows within Hungary, negatively impacting financial markets and the broader economy. To maintain the profitability of financial service providers and bolster investor confidence, it is essential to keep as much wealth as possible in Hungary, actively participating in local financial markets. A decrease in circulating funds could also lower public revenues, making long-term economic financing more challenging.

Surprisingly high rate of foreign currency loans

Telex reports that foreign currency loans now account for nearly half of all corporate loans in Hungary, a level not seen since a decade ago. The total stock of corporate loans reached HUF 12,780 billion (EUR 32.5 million) by the end of June, with most of this year’s increase driven by exchange rate changes, as the EUR/HUF rate climbed from 382 to around 395.

In addition, the rise in foreign currency loans, now totalling HUF 6,297 billion (EUR 16 million), is attributed to the scarcity of state-subsidised loans and the rising cost of forint loans. Foreign currency loans are primarily utilised by companies with substantial foreign currency revenues, such as exporters and real estate operators. However, for firms with forint revenues, these loans remain risky due to exchange rate volatility, as experienced during the 2008–2009 financial crisis.

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Featured image: depositphotos.com

August 25, 2024

Approximately 100 individuals with extreme wealth live in Hungary

Approximately 100 people in Hungary have financial wealth exceeding USD 100 million, making them among the ultra-high-net-worth individuals globally, according to a recent report by the Boston Consulting Group (BCG). Experts predict that this number will double in the next five years.

According to the BCG’s Global Wealth Report 2024, around 100 Hungarians currently have financial wealth over $100 million, classifying them as ultra-high net worth individuals, Portfolio reports. This places Hungary on a notable trajectory of wealth accumulation.

Additionally, another 700 Hungarians had between USD 20 million and USD 100 million in financial assets last year, showcasing a substantial segment of the population with considerable financial resources. The report also states that about 71,600 Hungarian citizens possess financial assets between USD 250,000 and USD 1 million, while another 22,000 citizens have between USD 1 million and USD 20 million.

Krisztián Horváth, associate director of BCG, noted that the Hungarian population is expected to see double-digit growth in financial wealth over the next five years. This projected growth rate surpasses the global average by four percentage points and is two percentage points higher than the growth observed in Eastern Europe. Such robust growth forecasts suggest a thriving economic environment. Consequently, Hungarian financial wealth is projected to reach an impressive USD 500 billion by 2028.

Of these assets, approximately two-thirds are classified as investable assets, which include shares, mutual funds, bonds, bank deposits, and cash. The remaining one-third consists of long-term pension savings, life insurance, and shares in unlisted companies. This distribution reflects global trends in asset allocation, where liquid and investable assets form the majority, providing individuals with flexibility and potential for growth.

BCG estimates that the proportion of cash and bank deposits in financial assets will drop below 20%, while the share of assets held in bonds, mutual funds, and equities will rise to 70%. This represents a 25-30 percentage point increase compared to global and Eastern European ratios, highlighting the advancement and maturity of the Hungarian wealth management and savings market.

Surge in super-wealthy individuals despite decline in long-term savings

However, this positive outlook is tempered by the steady decline in the share of long-term life insurance and pension savings, which have more than halved over the last 20 years. This decline suggests a shift in financial priorities and a potential gap in long-term financial planning among Hungarians, the portal says.

The anticipated surge in financial wealth over the next five years means that Hungary will have significantly more super-rich individuals. BCG expects that by 2028, the number of ultra-rich Hungarians will increase to 200, effectively doubling the current count.

Furthermore, the number of Hungarians with financial wealth between USD 20 million and USD 100 million is projected to rise from 700 to 1,300. This growth in the ultra-rich population underscores the dynamic economic landscape of Hungary and reflects broader trends of wealth accumulation and economic prosperity in the region.

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Orbán’s circle holds nearly EUR 4 billion in private equity funds – Read here
Hungarian workers earn less than 1/3rd of Austrian counterparts – Read here

August 1, 2024

Central Statistics Office: Hungary GDP up 1.5 pc in Q2

Hungarian gross domestic product (GDP) grew by an annual 1.5 percent in the second quarter, the Central Statistics Office (KSH) said in a first reading of data on Tuesday.

GDP growth in Q2

Adjusted for calendar-year effects, GDP grew by 1.3 percent.

Quarter on quarter, GDP edged down a seasonally and calendar year-adjusted 0.2 percent.

KSH said GDP was boosted the most by the construction sector and real estate transactions, as well as by the balance of product taxes and subsidies.

Commenting on the data, Mihály Varga, the finance minister, said that the Hungarian economy continued to expand, and “growth prospects give cause for optimism”.

In a video posted on Facebook, he said fresh data were positive despite “unfavourable external conditions” such as the war in Ukraine and economic malaise in the country’s main export markets in Europe, which, he said, was a drag on industrial output.

The finance minister noted recent government measures to consolidate the budget. “An additional 1,000 billion forints (EUR 2.5bn) in the budget has increased room for manoueuvre, so the growth outlook is getting more stable despite external difficulties,” Varga said.

Meanwhile, thanks to a successful campaign to curb inflation and hike pay, real wages have increased by 10 percent on average, he said.

An uptick in consumption reflects increasing confidence in the economic outlook, coupled with economic growth projections by the IMF and European Commission putting Hungary among next year’s frontrunners.

International credit rating agencies have also affirmed Hungary’s growth outlook, Varga said, adding that the government will carry on working to maintain fiscal balance while keeping the economy on a growth path.

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July 30, 2024

Hungarian finance minister: EU supports G20 financial targets

Mihály Varga finance minister public debt g20 2025 budget

The European Union supports the G20’s roadmap for enhancing cross-border payments, Mihály Varga, the finance minister, told public broadcaster Kossuth Radio on Friday.

Meeting of G20 finance ministers

Varga addressed a two-day meeting of G20 finance ministers and central bank governors in Rio de Janeiro on behalf of the EU.

The G20 countries must remain committed to international financial reforms, in which the EU is also a partner, Kossuth Radio quoted Varga as saying in his address.

The minister said the EU needed to do more in the interest of reducing vulnerabilities in the financial sector, which was why it supported the G20’s targets in making cross-border payments faster, more affordable, more accessible, more transparent and convenient.

He said it was important that the European financial system remain in the global competition deciding incomes and job opportunities.

Varga noted that one of the priorities of Hungary’s presidency of the Council of the EU was to improve the bloc’s competitiveness.

He said that despite efforts to maintain confidence, there remained vulnerabilities in the European financial systems.

The minister said high interest rates, uncertainties caused by the war, and concerns over budgetary sustainability meant it was important to continue to monitor the risks facing the financial sector, adding that this was also a priority during the Hungarian EU presidency.

Participants at the G20 meeting also discussed a new way to manage global debt.

Varga said Hungary, on behalf of the EU, had joined the G20 position that the international debt management framework should be implemented in a better and more predictable way.

On the sidelines of the meeting, Varga met the governor of Brazil’s central bank with whom he reviewed the status of bilateral economic and trade relations.

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July 27, 2024

Hungary and Türkiye sign agreement on finance, energy and defence

Türkiye is among Hungary’s important strategic partners, Mihály Varga, the finance minister, said after signing a memorandum of understanding covering finance, the defence industry, energy and the fight against migration, “which serves to deepen steadily developing Hungarian-Turkish relations”.

Hungary and Türkiye sign agreement

In numerous areas, Türkiye “is an indispensable partner” of the EU, and Hungary is committed to reinforcing cooperation accordingly, Varga told a press conference after a meeting with his Turkish counterpart in Budapest on Friday.

Varga said the agreement would result in closer cooperation in fiscal affairs, including macroeconomic and budget planning, public debt management and the modernisation of the treasury.

Turkish Finance Minister Mehmet Simsek said the new MoU complemented the existing strategic partnership. He said Türkiye-EU relations were expected to make progress during Hungary’s EU presidency, and he expressed thanks to Hungary for its related support. He also highlighted the modernisation of the customs union, the issue of the visa waiver programme and the relaunch of the European Investment Bank in Türkiye.

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July 13, 2024

PISA 2022 report on young people’s financial literacy released: Hungary ranks average

financial education literacy student pisa

The PISA 2022 report assessing the financial literacy of young people has been released and shows Hungary as ranking among the average of the 14 OECD countries examined, the Education Office (OH) said on Thursday.

PISA 2022 report on financial literacy out

The first large-scale international PISA study assessing the financial skills and knowledge of 15-year-olds was conducted in 2012. Participation is optional and Hungary joined it for the first time in 2022.

The 2022 assessment covered 20 countries including 14 members of the Organisation for Economic Co-operation and Development.

According to the OH, Hungarian students scored 492 points which is close to the average 498-point score of the participating OECD countries. The points Hungarian students scored is, however, above the overall average score of 475 points.

The OH noted that close to 82 percent of 15-year-old Hungarian students had the minimum or higher financial literacy skills expected from a social point of view.

A detailed report on the Hungarian youth’s results is expected to be released in the first half of July.

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Featured image: depositphotos.com

June 27, 2024

Hungary to cooperate with Dubai on a new front

The Hungarian Fintech Association has signed a letter of intent on cooperation with the Dubai-based MENA Fintech Association with the aim of boosting cooperation and promoting innovation.

In a statement, the associations said they were in agreement that competitive national economies could not function without a digitalised financial system and digital financial solutions.

The memorandum was signed by the heads of the associations at the Dubai Fintech Summit. The event was attended by representatives of Hungarian fintech start-ups, MBH Bank and MBH Fintechlab, among others.

Established in 2018, the MENA Fintech Association is one of the world’s four most active fintech associations with a strong presence in the Middle East and Africa. It is a leader in promoting innovation and building cooperation in the fintech industry. Its members include fintech start-ups, SMEs, financial institutions, tech firms, scientific circles, investors, accelerators, regulators and decision-makers.

The Hungarian Fintech Association was established in 2020 and has 56 members. Its main function is to assist policymakers, regulators and financial institutions in improving the regulatory environment for the fintech sector. The association also assists its Hungarian members in entering foreign markets and its international members in entering the Hungarian market.

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May 15, 2024