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14th March, 2019

MNB prepares to close NHB bank

The MNB appears to be preparing to shut down the troubled NHB bank, website Menedzsment Fórum reports.

Acting as the financial supervisory, the MNB has told the deposit guarantee fund OBA to prepare to pay NHB clients.

The MNB order limiting the withdrawal of deposits from NHB ends on March 18. The deadline cannot be extended further, as it has already been extended twice.

As a result, the MNB has to decide whether to end the withdrawal restrictions or start to liquidate the bank.

NHB has been unable to repay Ft 30 billion of deposits since December 18, 2018, when the MNB imposed a Ft 7 million ceiling on withdrawals and placed the bank under the control of a commissioner.

An audit by the MNB resulted in negative findings about the liquidity of the bank.

NHB closed all nine of its branches outside Budapest on January 25.

BanKonsult, a company owned by Tamás Szemerey, a cousin of MNB governor György Matolcsy, has a 98.5% stake in NHB, while Lebanon-based Fransa Holding has 1.5%.

Security guard company Valton may lose money on the liquidation of NHB because it had billions deposited with the bank, in an amount above the guarantee threshold.

Sources regularly consulted, with abbreviations used in text: Népszabadság (N); Magyar Hírlap (MH); Világgazdaság (VG); Napi Gazdaság (NG); Magyar Nemzet (MN); Népszava (Nsz); Kossuth Rádió news (KR); nightly TV news (TV).

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