OTP Bank to defend contracts in court

Budapest, July 24 (MTI) – OTP Bank and its subsidiaries will avail of their right to defend in court the fairness of contracts with borrowers, the lender said on Wednesday.

OTP Bank, OTP Mortgage Bank, Merkantil Bank and OTP Home Savings Bank will defend the contracts in court, the group said.

A law recently approved by parliament requires banks to refund borrowers whose contracts were unilaterally modified, unless lenders can prove in court that the changes were legal. The law also stipulates that banks must compensate borrowers for using exchange rate margins when calculating repayments for foreign currency-denominated loans.

OTP group said it is also considering whether to turn to the Constitutional Court regarding the legislation.

The conditions that the new law refers to are based on expectations that were not known at the time when the contracts were originally signed, the statement said.