How the Hungarian State-owned Banks were Privatised

C. W. Neale and S. Bozsik

Post-Communist Economies, 2001, vol. 13, issue 2, 147-169

Abstract: Hungary was the first transition economy to complete the process of privatisating state banks. This article outlines this process in the light of the economic and financial pressures after 1989, which had severely weakened the financial condition of these banks. It describes the ways in which bank balance sheets were consolidated by state-underwritten loan write-offs and injections of capital within a new legislative framework. The main privatisations are described in a set of mini-case studies. The process was effectively complete by end-1997. The EBRD was closely involved as adviser and investor, significant revenue was generated for the state (albeit much lower than the consolidation support required), foreign strategic investors were attracted and no major financial institution had to be liquidated. Despite the attendant controversy and scandal, the Hungarian experience offers useful lessons to other transition economies which have yet to seriously address this issue.

Date: 2001
References: View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://www.tandfonline.com/doi/abs/10.1080/14631370120052645 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:pocoec:v:13:y:2001:i:2:p:147-169

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/CPCE20

DOI: 10.1080/14631370120052645

Access Statistics for this article

Post-Communist Economies is currently edited by Roger Clarke

More articles in Post-Communist Economies from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().