The troubled Budapest Public Transport Company (BKV) is getting a state guarantee for its loans, mayor István Tarlós said at a press conference on Thursday.

"In spite of expectations to the contrary, BKV will probably escape its situation," Tarlós said.

The guarantee covers HUF 40 billion in debt that is expiring soon.

Tarlós said BKV's loans were set to mature "like dominoes", adding that that was the way the company's former management took them out.

He said that BKV's public service contract could be signed as soon as an agreement is reached on a long-term strategy for the company. He added that the government could free up HUF 32 billion in subsidies for the company if such an agreement is reached.