Hungary's banks say new law on loans hurts legal safety

BUDAPEST, July 4 Fri Jul 4, 2014 11:26am EDT

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BUDAPEST, July 4 (Reuters) - Hungary's Bank Association said new legislation on bank loans approved on Friday retroactively rewrites private contracts between banks and their clients, and threatens legal security.

In a statement, the association also said the new law would overwrite general rules governing the lapsing of contracts.

"This practice hurts legal safety and could create uncertainty among investors," it said, adding that it hoped Hungary's president would not sign the bill but send it to the Constitutional Court for review.

(Reporting by Krisztina Than; Editing by Kevin Liffey)