Moody's: Good move for Hungary banks

Moody's Investors Service said it believes that the measures being introduced by the Hungarian government to make foreign-currency loans less accessible to the retail segment may help to improve the currency structure of the banking sector's loan portfolio.

Although the country's banking system as a whole closed the 2009 financial year in relatively good shape, the agency said the underlying credit and funding risks related to the large portfolios of foreign-currency loans remain.

The recent initiatives of the government and the central bank to encourage forint-denominated lending, rather than foreign-currency lending, is positive for the banking system's financial stability in the long term, Moody's said.

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