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Will Retail Loans Collapse With Their Mass Soon? – asks the question in his article on portfolio.hu.
MNB’s statistics on non-performing retail loans are available to everyone. These show that there were 165 billion HUF in loans to households past due for more than 90 days at the end of September, which is just one eighth of the peak in early 2014. This is one of the most favorable data from the retrospective statistics of the central bank until early 2009.
Of course, this does not mean that the previous crisis was completely overcome by families with bad loans, nor does it mean that the coronavirus crisis would not create more payment difficulties in the future.
Nearly 102,000 expired mortgage contracts stood at 18 percent with banks at the end of 2019, and the remainder largely with debt managers.
The moratorium imposed amid Covid-19 affected 57 percent of the bank’s retail loan portfolio. Therefore, according to the economic portal, payment problems have so far been hidden from banks,
lenders don’t even necessarily see someone paying because they can’t or it’s worth staying in the moratorium. Therefore, it is difficult to predict the expected failure rate.
Undoubtedly, the expiration of the moratorium means the reinstatement of a contractual repayment obligation for a household. In most cases it will be a repayment charge equal to or close to February 2020, as the interest rate environment has not changed significantly since then.
The MNB survey also shows that the sociodemographic situation of clients who participate in the moratorium is more unfavorable than that of those who continued to repay.
- The financial conditions of homes with default are also worse.
- 53% of the households included in the moratorium have incomes below 300,000 HUF, while this proportion is only 35% in the case of those that do not.
- Forty-four percent of those who use the moratorium have at most one source of income, compared to 34 percent of those who pay.
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