Bloomberg News

Raiffeisen Sees Hungary Mortgage Fall Below 1 Billion Euros

March 29, 2012

Raiffeisen Bank International AG (RBI) expects its Hungarian mortgage book in foreign currencies to shrink to less than 1 billion euros ($1.3 billion) this year, Chief Executive Officer Herbert Stepic said.

Foreign-currency mortgages, most of which are in Swiss francs, have declined to 1.07 billion euros by the end of February, compared to 1.47 billion euros at the end of 2010, after clients repaid about 400 million euros at a discount last year, Raiffeisen said. That number will decline further by the end of the year, Stepic told analysts in Vienna today.

The Austrian lender, eastern Europe’s third-biggest, had an after-tax loss of 355 million euros in the neighboring country, where it started business before the Iron Curtain fell in 1989. That was driven by currency losses it was forced to swallow on the mortgages, as well as by other bad debt charges, it said.

To contact the reporter on this story: Boris Groendahl in Vienna at bgroendahl@bloomberg.net

To contact the editor responsible for this story: Frank Connelly at fconnelly@bloomberg.net


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