MNB urges bigger equity market presence for lenders, insurers

MNB

Photo by Adriana Iacob/Shutterstock.com

The National Bank of Hungary (MNB) on Monday said it issued a recommendation incentivizing the listing of more Hungarian banks and insurers on the Budapest Stock Exchange (BSE), according to a report by state news wire MTI.

The central bank and financial market regulator recommends that the owners of banks and insurers involved in merger and acquisition activity initiated in the period after April 1, 2022 weigh the listing of their institutions' shares on the local bourse.

In the recommendation, MNB designates as "good practice" the written commitment of local banks or insurers concurrent with an application for approval of M&A activity to list at least one series of ordinary shares on the BSE within two years after the clearance of the transaction.

The recommendation applies to M&A activity affecting at least 10% of voting rights of institutions with a market share of over 5%. It also applies to M&A transactions conducted by institutions with a market share exceeding 5% that boost that market share by more than 5%. The recommendation does not apply to M&A activity within corporate groups.

MNB expects free float of shares listed on the bourse as a result of the recommendation to reach at least 15%.

The central bank said the listing of more banks and insurers on the bourse and the compliance with the relevant disclosure rules would "further strengthen transparency and contribute to a higher degree of protection for depositors and small investors". Such listings could also result in "greater stress" on efficient business operation expected by owners, it added.

MNB noted that lenders' and insurers' presence on the local equities market is "extraordinarily low".

Hungary Account Deficit at EUR 561 mln in Q4 Debt

Hungary Account Deficit at EUR 561 mln in Q4

Moldovan Pensions to be Increased as of April 1 World

Moldovan Pensions to be Increased as of April 1

Schoenherr Names Miklós Klenanc as Head of Local M&A Practic... Appointments

Schoenherr Names Miklós Klenanc as Head of Local M&A Practic...

Hungarian Wine Marketing Agency to Host Summit Drinks

Hungarian Wine Marketing Agency to Host Summit

SUPPORT THE BUDAPEST BUSINESS JOURNAL

Producing journalism that is worthy of the name is a costly business. For 27 years, the publishers, editors and reporters of the Budapest Business Journal have striven to bring you business news that works, information that you can trust, that is factual, accurate and presented without fear or favor.
Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.