MILAN, July 21 Italian bank Intesa Sanpaolo
expects new Hungarian legislation requiring banks to
compensate borrowers for exchange rate spreads applied on
foreign currency loans to cost its second-quarter net income
around 65 million euros ($88 mln).
Intesa Sanpaolo, Italy's biggest retail bank, operates in
Hungary through its CIB Bank subsidiary.
Intesa said CIB intended to take legal action to prove that
any changes it had brought to the terms of foreign and local
currency retail loans were "fair, correct and compliant with the
relevant effective laws."
The bank said that it was not possible at this stage to
assess potential charges arising from compensation payable to
customers for unilateral changes of the loan conditions.
Intesa also said it could not at present estimate possible
further charges from a law expected to be approved in the second
half of 2014 concerning the conversion of retail
foreign-currency loans into Hungarian forints.
($1 = 0.7397 Euros)
(Reporting by Valentina Za, editing by Stephen Jewkes)