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Standard & Poor’s Upgrades Three Hungarian Banks, Including Biggest Lender OTP


Standard & Poor’s Ratings Services has revised its outlooks for three Hungarian banks to positive.The ratings agency said on Monday it revised its outlooks on Hungary-based OTP Bank, OTP Mortgage Bank and Magyar Takarékszövetkezeti Bank (Takarékbank) to positive from stable.

The positive outlook on OTP Bank and OTP Mortgage Bank takes into account S+P’s expectation of a “more benign operating environment in Hungary, and to a certain extent, in the rest of Central and Eastern Europe”. S+P said they could raise their ratings on OTP Bank and OTP Mortgage Bank by one notch because “we concluded that conditions in the domestic real estate market and the purchasing power of households had improved, while credit demand picked up, leading to less credit risks and better earnings for Hungarian banks.”

“Conversely, if economic risks for Hungarian banks don’t decrease as we currently anticipate over our outlook horizon, we could revise the outlook on OTP Bank to stable,” it added. “The positive outlook on Takarékbank reflects the improving economic environment in Hungary, and its expected tighter integration into the group of Hungarian savings bank cooperatives,” S+P said.

via photo: public domain