Easement On Loan Portfolio Transfers

The Hungarian Parliament has adopted an amendment to the Hungarian Banking Act (entering into force on 7 July 2015) that provides for the regulation of loan portfolio transfers.  The amendment aims to make Hungarian banks' lives easier by deviating from the general rule of the Hungarian Civil Code which normally requires a borrower to agree to the transfer between lenders and terminates all security interests, unless the security provider likewise agrees.  

Instead, under the new amendment, such a transfer must be authorized directly by the Hungarian National Bank, bypassing the need for the agreement of either the borrower or the security provider.

The Hungarian Banking Act's exemption covers only those portfolios that consist of at least twenty loan or financial leasing agreements, or whose value is higher than 10 billion forints (approx. EUR 33 million).  Thus, even one loan agreement may qualify as a 'loan portfolio', provided that the transaction value