Hungary's Szechenyi Bank offers to buy Raiffeisen unit -paper

BUDAPEST Mon Jan 6, 2014 4:43am EST

BUDAPEST Jan 6 (Reuters) - Hungary's partly state-owned Szechenyi Bank has offered to buy the loss-making Hungarian unit of Austria's Raiffeisen Bank International (RBI), daily newspaper Magyar Hirlap reported, without naming its sources.

Central and eastern Europe's No. 2 lender has said it wants to scale back in some markets including Hungary, where it lost 83 million euros ($112.99 million) after tax in the first half of last year. It faces further losses if new laws to help foreign-currency borrowers are passed.

Hungarian Prime Minister Viktor Orban, who faces elections this year, has often said that more than half the banking sector should be in Hungarian ownership.

Raiffeisen declined to comment on Monday. A Szechenyi Bank spokeswoman also declined to comment.

Szechenyi Bank had total assets of 19.6 billion forints ($89.26 million) at the end of 2012, according to a report on its web site. It is majority owned by Hungarian firm T&T Real Estate and Holding Co., while the government holds 49 percent.

Istvan Torocskei, who is also chief executive of the Government Debt Management Agency (AKK), is the majority owner of Szechenyi Bank via T&T Zrt. Torocskei could not be reached for comment.

Hungary's central bank governor Gyorgy Matolcsy said late last year that four major foreign banks could quit Hungary, with their departure coming much faster than previously expected.

Matolcsy did not name the banks.

The mostly foreign-owned sector posted hefty profits before the 2008 global crisis but loan defaults, windfall taxes and a 2011 government-imposed measure to help foreign currency loan holders have caused big losses.

Foreign banks which have units in Hungary include Austria's Raiffeisen and Erste, Italy's Intesa Sanpaolo and Unicredit, Belgium's KBC, German bank Bayern LB, Citi and the banking arm of General Electric.

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