Resolution Fund

Tasks of the Resolution Fund

With the creation of the Resolution Fund (Hungary), a new element has been added to the financial stability safety net. The Resolution Fund (Hungary), funded by the member institutions, aims to meet the funding needs of the financial sector without the need for public resources.

The main tasks of the Resolution Fund (Hungary) are to cover the costs incurred in the resolution phase of institutional crisis management, and to finance the use of resolution tools. According to Section 126 of Act XXXVII of 2014 on the Further Development of the Institutional System Strengthening the Security of Certain Actors of the Financial Intermediary System (hereinafter: “Resolution Act”) the assets of the Resolution Fund (Hungary) can be used:

  1. to guarantee the assets or the liabilities of the institution under resolution, its subsidiaries, bridge institutions or resolution asset management vehicles,
  2. to lend to the institution under resolution, its subsidiaries, bridge institutions or resolution asset management vehicles,
  3. to purchase assets of the institution under resolution,
  4. to provide capital contribution to a bridge institution or an asset management vehicle,
  5. to provide contribution to the institution under resolution for the purposes specified in Sections 59 to 60 of the Resolution Act,
  6. to reimburse the National Deposit Insurance Fund (hereinafter: “OBA”) in accordance with Section 143(5) of the Resolution Act,
  7. to compensate shareholders or creditors in accordance with Section 98 of the Resolution Act,
  8. to ensure that the principle of fiscal neutrality as set out in Section 128 of the Resolution Act is observed,
  9. to grant a loan on a voluntary basis to the resolution financing scheme of another EEA state,
  10. any combination of the actions referred to in items (a) to (i) hereinabove,
  11. to use the funds of the Resolution Fund (Hungary) for the actions set forth in items (a) to (d) hereinabove during the application of the sale of business tool with respect to the recipient, and
  12. to cover the costs directly related to the operation of the Resolution Fund (Hungary).

The assets of the Resolution Fund (Hungary) shall not be used directly to cover the losses of or to recapitalise an institution, a financial enterprise, a financial holding company, a mixed financial holding company or a holding company of miscellaneous operations.

The mission, vision and value statement of the Resolution Fund

Mission

The mission of the Resolution Fund is to provide financing for the efficient and effective application of resolution measures and resolution tools in order to maintain the financial stability of Hungary, while shifting the final burden to market participants and minimise the costs for taxpayers.

Vision

The Resolution Fund is a valued member of the Hungarian financial system, which provides financing for the successful application of resolution measures and resolution tools through its efficient and effective procedures, available assets and, if necessary, additional funding.

Values

The Resolution Fund is an organization operating on the basis of ethical values, which acknowledges to be bound by the provisions of the Code of Ethics of the National Deposit Insurance Fund of Hungary (OBA), which performs the operational tasks of the Resolution Fund.

Board of Directors of the Resolution Fund

The governing body of the Resolution Fund is the Board of Directors, which consists of:

Lóga Máté
Mr. Máté LÓGA

Secretary of State responsible for economic development and national financial services of the Ministry for National Economy, Chairman of the Board of Directors of the Resolution Fund

Mr. Csaba KANDRÁCS
Mr. Csaba KANDRÁCS

Deputy Governor of the Central Bank of Hungary (MNB), responsible for the supervision of financial institutions and consumer protection

Ms. Krisztina MOHÁCSI
Ms. Krisztina MOHÁCSI

Head of the Department of Resolution Law and Regulation of the Central Bank of Hungary (MNB)

Mr. András KÓMÁR
Mr. András KÓMÁR

Managing Director of the National Deposit Insurance Fund of Hungary (OBA)

Ms. Bernadett MARTONOVICS
Ms. Bernadett MARTONOVICS

Legal Director of the Hungarian Banking Association

The Managing Director of the Investor Protection Fund (Beva) may participate in the meetings of the Board of Directors of the Resolution Fund as permanent guest with right of consultation.

The Resolution Fund does not have an independent work organization, the operational tasks are performed separately by the work organization of the National Deposit Insurance Fund of Hungary (OBA) under the direction of the Managing Director of OBA.

Member institutions

Credit institutions and investment firms authorised in Hungary including Union branches are required to join the Resolution Fund.

Each new institution shall, simultaneously with submitting its application for its operating license, send a declaration of accession to the Resolution Fund and attach a copy thereof to the application for the operating license.

A detailed list of member institutions is available here: the list of the member institutions of the Resolution Fund.

Annual report

Once a year, no later than 30 May of the year following the end of the financial year, the Resolution Fund (Hungary) shall adopt its annual report and the auditor’s report, establish its financial position, and submit its annual report thereon to the State Audit Office.

Year Annual report
2023 Download
2022 Download
2021 Download
2020 Download
2019 Download
2018 Download
2017 Download
2016 Download
2015 Download
2014 Download

European Union regulations

With the adoption of the Bank Recovery and Resolution Directive (BRRD), the European Union had taken the necessary step towards setting up resolution authorities endowed with strong powers to deal with the crisis of credit institutions and investment firms. In Hungary, this official authority was granted to the Central Bank of Hungary.

A key principle of the regulation is that the costs of crisis management should be borne by schemes (e.g., resolution funds) that finance resolution from the contributions of market participants, in order to minimize the use of taxpayers’ money. For this purpose, the Resolution Fund was established in Hungary.

The establishment of the Resolution Fund served the compliance with DIRECTIVE 2014/59/EU OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 15 May 2014 establishing a framework for the recovery and resolution of credit institutions and investment firms and amending Council Directive 82/891/EEC, and Directives 2001/24/EC, 2002/47/EC, 2004/25/EC, 2005/56/EC, 2007/36/EC, 2011/35/EU, 2012/30/EU and 2013/36/EU, and Regulations (EU) No 1093/2010 and (EU) No 648/2012, of the European Parliament and of the Council (“BRRD”).

The official English language text of the BRRD can be downloaded here:

National leglislation

Act XXXVII of 2014 on the Further Development of the Institutional System Strengthening the Security of Certain Participants in the Financial Intermediary System, which contains the fundamental provisions of resolution and established the Resolution Fund (Hungary), can be downloaded here:

Partner institutions

In the performance of its tasks, the Resolution Fund may use the services of the National Deposit Insurance Fund of Hungary (OBA) and the Central Bank of Hungary (MNB) in a manner that does not violate the prohibition of monetary financing.

Central Bank of Hungary (MNB)
Krisztina körút 55., 1013 Budapest, Hungary
Phone: +36 1 428 2600
www.mnb.hu

Ministry for National Economy (NGM)
Vám utca 5-7., 1011 Budapest, Hungary
https://kormany.hu/gazdasagfejlesztesi-miniszterium

Ministry of Finance (PM)
József nádor tér 2–4., 1055 Budapest, Hungary
Phone: +36 1 795 1400
https://kormany.hu/penzugyminiszterium

National Deposit Insurance Fund of Hungary (OBA)
City Gate 1. Office Building, 6th Floor, Köztelek utca 6., 1092 Budapest, Hungary
Phone: +36 1 214 0661
www.oba.hu

Investor Protection Fund (Beva)
City Gate 1. Office Building, 4th Floor, Köztelek utca 6., 1092 Budapest, Hungary
Phone: +36 1 216 7130; +36 1 216 7131
www.bva.hu

The Government Debt Management Agency Pte Ltd. (ÁKK)
Krisztina tér 2., 1013 Budapest, Hungary
Phone: +36 1 488 9488
www.akk.hu

KELER Central Securities Depository Ltd. (KELER)
Rákóczi út 70-72., 1074 Budapest, Hungary
Phone: +36 1 483 6100
www.keler.hu

Financial Stability and Liquidation Non-profit Ltd. (PSFN)
1st Floor, Bajcsy-Zsilinszky út 78., 1055 Budapest, Hungary
Phone: +36 1 321 0116
www.psfn.hu