Hungarian central bank deputy governor

Central bank deputy governor resigns in protest

April 8, 2013

Deputy Governor of the National Bank of Hungary (MNB), Júlia Király submitted her resignation on Monday. She also resigns as member of the Monetary Council. She wishes to protest against recent changes at MNB.

Király said the atmosphere created over the past few years facilitated a creative operation that was based on the purely professional work of the central bank staff. The philosophy of the bank was conservative and committed; there was no dread or mistrust which could lead to decisions that are not thought through. This changed recently as György Matolcsy swapped his national economy ministerial post for that of MNB governor.

Király said the new operational structure is putting at risk the central bank’s domestic and international prestige it took long years to establish. "The Potemkin solutions can help for only so long. It is not good monetary policy if you make decisions that may not create much benefit but at least they do not ruin the forint - this cannot be a criterion for success."

"In my view, the new organizational and operational regulation modified at the request of Mr Matolcsy delegated the staff preparing Monetary Council decisions under a Deputy Governor that has no sufficient theoretical knowledge and practical experience in issues related to monetary, financial and credit institutional activities," Király referred in the letter to the appointment of Ádám Balog.

The letter sent to President János Áder explains Király’s decision by saying – among other things – that the new decision making method, ensures it less and less that responsible decisions are made. "I have no apocalyptic visions, the forint will not collapse but in the longer term. the decisions of the past month could demand high costs."

Király said that by resigning, she wanted to emphasize the gravity of the situation.



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