BUDAPEST, Dec 21 (Reuters) - Banks operating in Hungary had abused their dominant position in foreign currency lending and legislation is needed to tackle the problem of foreign currency loans that burden households, central bank Governor Gyorgy Matolcsy said on Saturday.
Matolcsy told private channel HirTV that a law was needed to resolve the problem retroactively and going forward.
'The stance of the National Bank of Hungary is clear: banks had abused their dominant position,' Matolcsy said in an interview.
Matolcsy said it was morally and economically unacceptable that the banks, due to their strong position, had an option to modify foreign currency loan contracts unilaterally. He said the Supreme Court failed to settle the problem and therefore legislation was needed.
The court ruled on Monday that banks are not to blame for borrowers losing out on foreign currency loans. However, the court has not ruled on the question of whether the banks were sufficiently transparent about unilateral changes to the loans, for example, hiking interest rates.
(Reporting by Krisztina Than/Sandor Peto) Keywords: HUNGARY FXLOANS/
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