Magyar Nemzeti Bank reports 303 billion forint loss

The Magyar Nemzeti Bank (MNB) recorded a loss of 303.2 billion forints in the first six months of the year, an increase of 55.2 billion forints compared to the same period in 2025. As of the end of June, the central bank's equity reached a deficit of 3,218.7 billion forints, equivalent to approximately 3.5 percent of Hungary's GDP.

The financial deterioration stems from several factors, including previous low-interest loan and bond programs designed to stimulate the economy. When interest rates were raised to combat inflation, the MNB had to pay significantly more in interest to commercial banks than it earned from its previous holdings. Additionally, the strengthening of the forint has reduced the forint-denominated value of the bank's foreign exchange reserves.

Following significant losses, the Hungarian government amended the central bank law at the end of 2023. The amendment replaced a strict five-year deadline for rectifying capital deficits with a requirement to resolve the shortfall within an ‘acceptable timeframe,’ a term that lacks a specific legal definition.