Hungary’s government could consider a second, targeted extension of a moratorium on loan repayments, depending on circumstances in the spring, Márton Nagy, an advisor to the prime minister, said in Friday’s issue of pro-government daily Magyar Nemzet.
“We’ll review the situation next spring and weigh the issue of whether it’s necessary to keep the repayment moratorium in place for targeted groups,” Nagy told the paper.
Last week, the government decided to extend a blanket loan repayment moratorium set to expire at the end of the year by six months, but only for families with children, pensioners, the jobless, fostered workers and companies whose revenue has fallen by more than 25 percent because of the pandemic. The government also decided to prohibit banks from cancelling any retail or corporate pre-crisis loan contracts for six months, effectively putting the onus on lenders to restructure the credit of distressed borrowers who are not covered by the extended moratorium.
The moratorium was one of the first measures the government introduced in the spring to shield against the economic fallout from the pandemic.
Some 1.6 million, or 60 percent of retail borrowers have availed themselves of the moratorium. Their outstanding credit approaches 3,500 billion forints (EUR 9.6bn), or 53 percent of retail lending stock, Nagy said.
Of the 60,000 corporate borrowers availing of the moratorium, one-third do business in sectors most vulnerable to the crisis: tourism, transport and services.
Nagy said that the moratorium had left retail and corporate borrowers with some 2,000 billion forints, while the six-month extension would leave borrowers with some 450 billion.
Featured photo by Tamás Kovács/MTI