Brokerage market turmoil adds volatility to HUF asset prices

The National Bank of Hungary (NBH) today offered more details about losses discovered at three local brokers.

The total amount of potential losses exceeds HUF 315bn, which is equivalent to EUR 1.0bn or 1% of GDP.

UniCredit Research notes in a report on Tuesday:

• The National Bank of Hungary (NBH) today offered more details about losses discovered at three local brokers. The total amount of potential losses exceeds HUF 315bn, which is equivalent to EUR 1.0bn or 1% of GDP.
  
  
• The direct and immediate impact on HGBs is limited as long as financial institutions incur negligible losses from this triple-fraud case. 
  
  
• In the short-to-medium term, a stream of bad news would only add to market nervousness and increase FX and bond volatility.