Hungarian Town May Sue Erste Bank on Loans, Magyar Nemzet Says
The Hungarian city of Hodmezovasarhely will probably sue the Hungarian unit of Erste Group Bank (EBS) AG because of a dispute on sharing losses on the town’s foreign-currency debt, Magyar Nemzet reported, citing Mayor Janos Lazar.
The town asked the bank to share the burden on Swiss franc- denominated loans currently worth 14 billion forint ($62 million), and the lender responded that the municipality should pay back 10 billion forint in a lump sum as a precondition for a deal, the newspaper said.
Lazar, who is also the head of the ruling Fidesz party’s parliamentary group, will seek permission to start a lawsuit against the Erste bank unit to determine how much of the exchange-rate loss should be taken by the bank, Magyar Nemzet said.
Katalin Banhegyi, a Budapest-based spokeswoman for Erste, declined to comment on the report when contacted by Bloomberg by telephone today.
To contact the reporter on this story: Andras Gergely in Budapest at agergely@bloomberg.net
To contact the editor responsible for this story: Gavin Serkin at gserkin@bloomberg.net
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