VII. Monetary Sector
Author:
Ms. Karen Swiderski https://isni.org/isni/0000000404811396 International Monetary Fund

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Abstract

Before 1987 the banking system was essentially of the monobank variety, characteristic of centrally planned economies. The dominant financial institution, the National Bank of Hungary (NBH), was both the central bank and the prime commercial bank for the enterprise sector. Banking services to households were provided separately by the National Savings Bank and a network of saving cooperatives. In addition, the financial system included several small joint venture banks and a limited number of specialized financial institutions, such as the Foreign Trade Bank—which was mainly involved in the financing of external trade—and the State Development Bank—which largely operated with budgetary funds to finance state initiated investments.