The National Bank of Hungary (NBH) will introduce green financing schemes for consumers and businesses next year.
Despite 1,150 basis point reduction, Hungary’s 6.5% base rate remains the highest in the European Union, alongside that of neighbouring Romania, following an inflation jump to levels around 25% during Russia’s 2022 invasion of Ukraine.
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According to Reuters, faced with a sluggish comeback from last year’s recession, Prime Minister Viktor Orban’s government has urged the NBH to slash interest rates more rapidly, though the veteran leader has eased his pressure on the bank ahead of an NBH leadership transition in March.
Under a previous green housing program that began in October 2021 and ended a year later, the NBH gave commercial banks with funding of 299 billion forints ($831.43m), which they may then lend to retail customers at a 2.5% interest rate.
Nationalist Orban, who has been in office since 2010, has battled to restore Hungary’s economy after last year’s collapse, using a variety of steps to protect borrowers from high interest rates, which the NBH has warned undermines its independence.
Finance Minister Mihaly Varga is largely expected to succeed Matolcsy early next year, while Economy Minister Marton Nagy, a former central banker, might oversee public finances in a merged ministry.
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By GlobalDataMeanwhile, DBS, in partnership with Envision Energy, announced a green loan facility to develop a 100-megawatt wind turbine farm in the Henan province, located in northeastern China.
DBS China also served as the sole green finance advisor for this loan to ensure that the terms comply with the China-EU Common Ground Taxonomy.
The loan is worth RMB 500m (SGD 92m / £53.75m).
The project is expected to generate about 270 gigawatt hours of renewable energy, enough to power 90,000 households and avoid 212,600 tonnes of carbon emissions annually.
The loan will be issued under the People’s Bank of China’s (PBOC) Carbon Emission Reduction Facility and represents the first successful transaction in this programme by a Southeast Asian bank.
