Hungary: Controversial Swiss franc loan law goes into effect

The legislative fix benefits only those bank customers who have taken up their currency loan at a rate of less than 180 forint to the Swiss franc and less than 250 forint to the euro. The banks are obliged to honour these exchange rates for repayment and pay any additional costs. This solution has generated "enormous outrage" throughout Europe, according to the online edition of the weekly newspaper "HVG".

Even a low response rate for final balloon payment settlements in foreign currency loans could inflict "heavy casualties" on the financial system, the newspaper wrote. The "rush" on the banks can now begin. According to the online edition of the daily newspaper "Nepszabadsag", experts predict that the new legislation will cause a price fall of 5 to 10 percent in the Hungarian real estate market.