Regulatory Requirements for Banks Operating in Hungary

Foreign Banks Operating in Hungary

In this section, we will address specific questions related to foreign banks operating in Hungary.

Can a Foreign Bank Operate in Hungary on the Basis of its Domestic License?

Yes, but with certain conditions. A foreign bank can operate in Hungary based on its domestic license either on a cross-border basis or through its Hungarian branch. It must:

• Notify its home regulator
• Obtain approval from the National Bank of Hungary

Can a Foreign Bank Operate in Your Jurisdiction on the Basis of its Domestic License?

Yes, with the same conditions as above.

Ownership Restrictions and Requirements

This section outlines the restrictions on ownership, including foreign ownership of banks operating in Hungary.

Restrictions on Ownership:

• Shareholders holding 5% or more in a bank must notify the bank and the National Bank of Hungary
• The constitutional document of a bank may regulate the maximum level of voting rights exercisable by a shareholder

Acquisitions and Increases of Qualifying Holdings in Banks

In this section, we will address the requirements for proposed acquisitions and acquirers of qualifying holdings in banks operating in Hungary.

Requirements for Acquirers:

• Be independent
• Have a good business reputation
• Be capable of maintaining reliable leadership
• Have transparency in their business connections and ownership structure

National Bank of Hungary Consent:

• The National Bank of Hungary must consent to the acquisition of a qualifying holding or an increase in a qualifying holding to reach 20%, 33%, or 50%.