FRANKFURT (MNI) – The European Central Bank has expressed concern
over a recent draft law in Hungary that it says would undermine the
independence of the country’s central bank, the ECB said in a press
statement published on Thursday.

Earlier this month, the Hungarian government, without consulting
the ECB, introduced proposals to merge Magyar Nemzeti Bank with the
Financial Supervisory Authority, appoint a new president above the
current central bank governor and increase the number of members of the
governing council, all of which would be “to the detriment of central
bank independence,” the ECB said.

“In particular, by appointing a new President with authority over
the Governor of the MNB, who would become the Vice-President of the new
institution, the personal independence of the MNB’s Governor would be
impaired and Article 14.2 of the Statute of the European System of
Central Banks concerning the possible reasons for dismissing the
Governor of a national central bank would be breached,” the ECB’s
statement said.

“The Governing Council of the ECB has requested the Hungarian
authorities to bring their consultation practice into line with the
requirements of European Union law and to respect the obligation to
consult the ECB. Three major revisions of the central bank law in 18
months are incompatible with the principle of legal certainty.”

— Frankfurt bureau: +49 69 720 142; email: —

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