* Listing, selling majority stake in MKB are options-minister
* MKB purchase helps lift Hungarian ownership, lending-Varga
* No further foreign banks are expected to withdraw-Varga
BUDAPEST, July 29 Hungary's government may list the shares of MKB, the country's fifth biggest bank by assets, on the stock exchange, after buying it from German lender BayernLB, Economy Minister Mihaly Varga said on Tuesday.
The state-backed German bank said last week that it would sell MKB to Hungary for 55 million euros, and that it would also waive 270 million euros of receivables.
Varga said the government, which has a policy to increase Hungarian ownership in the banking system, would consolidate the loss-making bank. But it does not aim to keep the bank in state hands, "partly due to EU requirements and partly because of the economic logic", he told InfoRadio in an interview.
"Certainly, after it is consolidated... the majority ownership of the bank must go to private owners," he said.
"This may mean a bourse listing or selling a majority share package of the bank: that is many solutions are possible in principle," the minister added.
When asked if MKB must stay in Hungarian ownership, he said the government would decide on MKB's future on Wednesday.
With MKB's purchase the government will meet its goal to increase Hungarian ownership in banks to above 50 percent in total bank assets, Varga said.
BayernLB has to sell MKB by 2016 based on a European Commision restructuring order.
Hungarian banks pay some of Europe's highest tax and legislation to help borrowers is also expected to a cost them billions of euros this year.
But the foreign owners of all the big Hungarian banks have said that they would stay in Hungary in the long term and they have taken measures to cover the losses, Varga said, when asked if more foreign banks would withdraw.
"So in that respect, I do not expect any bank bankruptcy or withdrawal," he said.
Foreign banks operating in Hungary include Austria's Erste and Raiffeisen, Italy's Intesa and UniCredit and Belgium KBC.
Central bank governor Gyorgy Matolcsy, who was Varga's predecessor as economy minister, has said that some of the biggest foreign banks could withdraw from the country.
Varga said the government agreed with the central bank that Hungary needed a stable, well-capitalized banking system, in which "the decisive majority is in Hungarian ownership."
The purchase of MKB helps the government achieve that, and also brings it towards its goal of reviving lending, which fell sharply after the 2008 bank crisis due to deleveraging by the foreign owners of Hungarian banks, the minister said. (Reporting by Sandor Peto, editing by William Hardy)