Hungarian National Bank

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Hungarian National Bank (Magyar Nemzeti Bank)
HNB.jpg
Founded 1924
Headquarters Budapest, Hungary
Key People Governor András Simor
Website http://english.mnb.hu/Engine.aspx

The Hungarian National Bank (HNB)is the central bank of Hungary has been an independent entity since 1991 following 40 years as an arm of the ruling Communist Party. The HNB sets Hungary's official interest rates and decides forex parameters for the Hungarian forint.

History[edit]

The HNB traces its beginnings to the founding of the Austrian National Bank in 1816, when Hungary was part of the Hapsburg empire. Following the establishment in 1849 of the Hungarian Commercial Bank of Pest and in 1878 by the Austro-Hungarian Bank, Hungary's first independent central bank, the National Bank of Hungary, opened in 1924.[1] Under communism the banking system operated on a single tier and HNB also operated a commercial banking network, but this ended in 1987 and the bank became independent in 1991.

Easing off[edit]

Since November 2008, when international confidence in Hungary's economy plummeted, the HNB has been rapidly cutting interest rates rapidly - the latest by 50 basis points in January 2009 to the current 9.50 percent.[2] The HNB surprised the capital markets by cutting interest rates twice in two weeks, each time by fifty basis points, in November-December 2008.[3] A month earlier the HNB had hoisted rates to 11.5 percent to discourage speculation on the Hungarian forint, which had been threatened with collapse.

Key people[edit]

HNB governor András Simor has held the job since March 2007 and though previously described as low profile[4] he has recently become a familiar figure on Hungarian television screens as he explains the central bank's monetary outlook.[5] He was reported in 2008 as Hungary's best-paid public servant, receiving a monthly salary of HUF 7.4 million (about $30,500).[6] Prior to joining the HNB, Simor spent seven years as managing partner at financial consultancy Deloitte & Touche Hungary and also helped establish and grow Hungary's premier brokerage, Creditanstalt Securities.

Latest News[edit]

The HNB recently announced a downsizing plan to lay off 91 employees - around 14 percent of its entire staff - over the next two years as part of an efficiency drive, local media reported in February 2009.[7] The lay-offs are reportedly unrelated to Hungary's recent currency meltdown following the global credit crisis.

References[edit]