Business 19 November 2025, 3:35pm

Hungarian state reduces stake in MBH Bank

Portfolio

The MBH Bank Employee Share Ownership Programme organisation has signed an agreement with the state-owned Corvinus BHG Zrt. to purchase a 5% stake in the bank, reducing the state's holding from 20% to 15%. The state will receive HUF 42.1 billion (equivalent to 2.6% of the bank's market value) for its 5% stake, and may also be entitled to a one-off additional purchase price payment at a later date.

MBH Bank has announced on Tuesday that it is restructuring its executive performance remuneration system. In line with market standards and following a decision by its general meeting, the credit institution has launched a share-based incentive programme. The renewed programmes are linked to the achievement of institutional objectives and include MBH Bank Nyrt ordinary shares, thereby strengthening the alignment of shareholder and management interests. To this end,

the organisation running the MBH Bank Employee Share Ownership Programme entered into an agreement with Corvinus BHG Zrt. to purchase shares representing a 5% stake in the bank.

The share package remains the property of the Employee Share Ownership Programme Organisation. Managers participating in the remuneration programme are entitled to a share of the increase in the value and yield of the shares, based on predetermined conditions. At its extraordinary general meeting on 19 September 2025, the credit institution also approved the renewal of the bank's performance-based remuneration structure, including the launch of the Common Shareholder and Value Appreciation Programmes.

They said that the measures approved by the general meeting and the management bodies with regard to the restructuring of the remuneration system are in line with the company's efforts to increase its free float on the stock exchange. This is because they align the remuneration of the relevant employees with the interests of shareholders, as reflected in an increase in the share price.

The bank has already indicated recently that it would increase its stock market presence by selling its own shares by the end of 2025.

To implement the share-based programmes, MBH Bank's Employee Share Ownership Programme (MRP) Organisation and Corvinus BHG Asset Management Ltd entered into a share purchase agreement. Under the over-the-counter transaction, the MRP Organisation purchased a total of 16,126,481 shares, representing a 5% ownership interest in the bank, from the indirectly state-owned company.

The purchase price of HUF 42.1 billion was determined based on the valuation of an independent international financial advisor, one of the Big4 companies, they emphasised.

The bank's announcement added that the agreement includes a purchase price compensation mechanism, whereby

Corvinus BHG Zrt. could receive an additional one-off payment at a later date, subject to certain conditions.

The bank's announcement did not elaborate further on this.

As the state's ownership stake continues to decline, MBH is increasingly becoming the property of Lőrinc Mészáros. This is particularly pertinent given that István Száraz, who was associated with Ádám Matolcsy, the son of former central bank Governor György Matolcsy, has left the company, leaving Mészáros with a 60% stake in the financial institution, hvg.hu reported.

A small portion of the shares of the bank holding company established in April 2023, less than 14%, is traded on the stock exchange, while Lőrinc Mészáros owns 46-47% of the bank through his companies, 444.hu pointed out.

The government (Fidesz) clearly intended for MBH to rival Sándor Csányi's OTP bank. At the time of its launch, it was Hungary's second-largest bank based on total assets, and it had the largest branch network and one of the largest ATM networks. It also had a market-leading position in several areas, such as the corporate and leasing markets.

The stock market prices in August 2023 also seemed to symbolise that MBH was intended to be an almost equal counterpart to OTP. On the first trading day, the closing price of MBH shares was HUF 12,000, while OTP shares closed at HUF 12,925.

To put it mildly, the two stocks followed different paths. MBH's highest closing price since 7 August 2023 was 9,300 forints in November of that year. And then it only closed north of the HUF 8,000 mark only on 16 days.

By contrast, OTP's share price fell below its 2 August 2023 high of HUF 12,925 on only one day in September 2023, and there were just 52 trading days when it closed at less than HUF 1,000 more than on that day.