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Central Bank of Hungary digs into reserves to supply banks with foreign currency

Measure aims to cover mismatch prompted by government plan to convert FX loans into local currency

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The Central Bank of Hungary (CBH) said this week it will use reserves to help banks meet liabilities in foreign currency that it believes pose a risk to the country's exchange rate.

The programme, which will be launched in October, is intended to cover a looming currency mismatch on banks' balance sheets that will result from a government plan to convert forex-denominated consumer loans into Hungarian forint.

Loans denominated in euros and Swiss francs were popular in Hungary ahead of the

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