The Hungarian Banking Association held its annual ordinary General Meeting today. Finance minister, Mihály Varga, delivered an evaluation the current state of the Hungarian economy, and Governor of the National Bank of Hungary, György Matolcsy, presented a vision for Hungary following the pandemic, and both greeted the participants of the General Meeting in a video message.
The Members of the Hungarian Banking Association decided to issue the following statement concerning the current state of the economy:
The state of emergency caused by Covid-19 in 2020 has continued into the first half of 2021. The successive waves of the pandemic and the spread of the coronavirus have manifested themselves differently across the European Union. Governments have taken a variety of protective measures. In Hungary, the third wave has caused the most severe health challenge. The possibility of restarting the economy as quickly as possible is helped by an effective vaccination program.
Data available to us show that the Hungarian economic downturn in 2020 corresponds to European trends; whilst the rate of unemployment has been largely kept under control and real wage growth has remained stable for the majority of people who managed to keep full-time jobs. There are clear signs that in 2021 the economy is on the way to recovery. This has been to a great extent facilitated by the Hungarian banking sector's lending activity in coordination with the measures implemented by the Government and the National Bank of Hungary. Another significant factor at play was that the moratorium on loan repayments introduced in Hungary to ease the burden on retail and business clients caused by the pandemic turned out to be the most favourable scheme for customers across Europe. Sparing no effort or extra costs, the Hungarian banking sector has demonstrated its readiness to serve its retail and business clients despite the major challenges faced. In 2020, a year ravaged by the pandemic, corporate loan disbursements increased by 6% compared to the previous year, and, parallel with this, Government family welfare support programmes were developed and implemented by the banking sector, even as the aggregate cost of the loan repayment moratorium schemes is expected to exceed HUF 400 billion. The key goal of the moratorium, and, in particular, the core task of the banking sector is to provide targeted and effective support specifically to those who need it. A programme that goes beyond this goal can no longer be professionally supported by the Hungarian Banking Association, as there is no justification for incurring extra costs for the banking sector in respect of customers who have sufficient income and/or reserves to meet their financial obligations. The fast rebooting of the economy and the maintenance of the intensity of lending activity in the banking sector are guaranteed by the fact that both professional and social aspects are taken into consideration.
However, the extraordinary difficulties have yielded positive effects as well: banks have accelerated digital transformation, and in just a few months we made as much progress as we would normally have in a decade. This has an impact in all areas of the economy. Looking ahead, electronic payments are expected to increase, leading to a whitening of the economy and a rise in tax revenues, as well as a drop in the costs associated with cash usage. Paper-based transactions and related administrative duties are declining. New forms of engaging workforce are emerging, resulting in more flexible work solutions that may be better suited to individual life situations. New types of jobs are created, and their quick adoption brings competitive advantages. However, we must also be mindful that, due to the accelerated digital transformation, the number of attempts at fraud in the field of electronic banking is on the rise, and new forms of cyber-crime are emerging. These can only be countered effectively through extensive cooperation and professional assistance in the fields of IT and finance, the deepening of our clients’ financial knowledge and conscious customer behaviour.
Taking a look at the international scene, we see that the system of global relations is shifting, and in this process diverging interests come to the surface, often leading to conflict. In this complex and volatile period, Hungarian foreign economic activity progresses and defines its goals in the fields of investments, economic co-operation and export-import markets with an openness and readiness to seize new opportunities, including on export-import markets. The toolkit available the Hungarian banking sector makes a significant contribution to the success of these processes. The development of global integration and co-operation, with special focus on the European Union, also supports the stability and strengthening of financial markets, contributing to sustainable economic growth.
In recognition of last year's achievements, prizes were also awarded at the General Meeting.
‘Golden Beehive Award’ recipients:
- Katalin Baginyi (Unicredit Bank) for her outstanding achievements in corporate financing and the development of banking products,
- Tibor Gáspár (Raiffeisen Bank) in recognition of his unrelenting efforts in the fields of taxation and accounting,
- Erika Lakos (K&H Bank) for her outstanding work in the field of banking regulatory tasks,
- Erik Landgráf (Takarék Mortgage Bank) for his unique service in the field of legal regulation of the banking sector,
- József Polgár (KDB Bank) for several decades of outstanding work in the field of vault and cash management.
‘Ambassador of Financial Culture’ award recipients:
- Zsófia Strasszer (‘Keleti Károly’ High School of Economics, Budapest) secondary school student, winner of the 2021 European Union Financial Quiz (organised under the EBF’s European Money Week programme),
- Viktória Hegyi (‘Keleti Károly’ High School of Economics, Budapest) coach of the 2021 European Union Financial Quiz champion.
As the former chairman of the Hungarian Banking Association’s Supervisory Board, David Moucheron (K&H Bank) will continue his career at the parent bank, he resigned from this position. For the term ending with the election of new officials in 2023, the General Meeting appointed Balázs Tóth (Unicredit Bank) as Chairman of the Supervisory Board.
The bank CEOs attending the General Meeting expressed their special thanks to colleagues in the financial sector for their dedication over the past year. Concerning the handling of the pandemic situation, all key observers were highly appreciative of the performance of the banking sector and its employees. We are thankful for the recognition and acknowledgment of our work, and will remain committed in our effort to fully earn this trust in the future.
Budapest, May 26, 2021 The Hungarian Banking Association