Banks may lose Euro 1 Billion in Hungary

A Fiat Law imposed on banks in Hungary by the 'democratic' Orban regime could cost them nearly Euro 1 billion. This is due to the setting of an artificial exchange rate on foreign currency borrowings by Hungarians (mostly to finance mortgages at cheap Euro or Swiss Franc interest rates).
We have always scratched our heads when we read about the absurdly high prices that were paid for East European banking 'assets' before the credit crunch. The financial structure was also wrong - the subsidiaries in the individual countries should have been organised on a stand-alone basis so they could be cut loose in a worst-case scenario. Local funding would mean than devaluations would not be a problem for the parent company.