The Ministry of Agriculture welcomes the MNB’s position regarding the agricultural loan moratorium

By: STA Date: 2022. 09. 06. 10:48

The Ministry of Agriculture draws the attention of farmers to the position of the Hungarian National Bank, which informs about the procedure for bank classification of loans in payment moratorium. This provides special guidance for bank customers who did not participate in previous credit moratoriums, but now enter the agricultural moratorium, i.e. suspend their loan repayments: it expects the banks to comply with lighter regulations.

The position of the MNB also helps farmers

In practice, this means that the banks do not have to automatically and forcibly downgrade the classification of farmers who did not participate in the previous moratoriums and their loans related to the agricultural moratorium, and they do not have to evaluate the suspension of loan repayment as an event of default. They have the opportunity to decide individually, based on the rating of the transaction and the client, on the need to reclassify individual loans, to rate them based on lighter criteria.

This resolution contributes to maintaining the creditworthiness of agricultural enterprises. The Ministry of Agriculture trusts that the players in the banking market are as flexible as possible with these customers, since the country’s food security depends on the farmers staying on their feet.

The opportunity to participate in the loan moratorium was made possible for agricultural enterprises from September 2022 to the end of 2023 by the Drought Emergency Operative Tribe, with the aim of mitigating the consequences of the extreme drought. Farmers can decide for themselves whether to use the moratorium on their loans in order to reduce their burdens.