Magyar Nemzeti Bank (National Bank of Hungary)

By: EconomyWatch   Date: 9 September 2010

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The Magyar Nemzeti Bank (MNB) or the National Bank of Hungary began its operations on June 24 1924 in the form of a company limited by shares.

The MNB is the central bank of the country and is also a part of the European System of Central Banks (ESCB). The bank's main objective is to promote price stability in the country. According to the Hungary's Central Bank Act, which paved the way for the formation of Hungary's National Bank, "The primary objective of the MNB shall be to achieve and maintain price stability. Without prejudice to its primary objective, the MNB shall support the economic policy if the Government using monetary policy instruments at its disposal." As part of its central banking activities, the bank performs following broad functions:

  • Issuing the national currency and controlling its circulation in the country
  • Deciding on the Central Bank base rate
     
  • Publishing the official exchange rate
     
  • Managing the national reserves of the foreign currency and gold
  • Promoting and controlling price stability within the Hungarian territory

The President of the Hungarian National Bank is appointed by the President of the Republic on the proposal of the country's prime minister. The Monetary Council is the highest decision making body of the Hungarian National Bank. It is important to note here that the MNB is being divested off most of its powers, as Hungary gets ready to join the Euro by 2010.

The MNB, as part of its policy, maintains a mid-term inflation target of almost 3%. This is in variation to the generally accepted inflation level for price stability across European economies.

The Address and Contact details of the bank is as follows:

Magyar Nemzeti Bank

Address: 1054 Szabadság tér 8/9 1850 Budapest (postal) HUNGARY Phone No.: ++36-1-302 3000; -428 2600; -428 2752 Fax: ++36-1-332 3913


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