Hungary financial services in 2021
Since 2003, Healy Consultants Group PLC has been assisting our Clients with the A to Z of financial services licencing in almost every country, including Hungary. We are the best in the world at securing financial licence approvals for our Clients. These licences are regulated by Magyar Nemzeti Bank (MNB) in sectors including insurance, asset management, forex and securities brokerage and payment services.
Hungary Forex Broking Licence
- All forex brokers who want to legally operate in Hungary must obtain a licence from MNB;
- The company must i) have a physical office in Hungary ii) have two Hungary-resident directors iii) have a minimum capital of €125,000;
- As part of the licensing process, the company must submit a detailed business plan and the management is subject to the fit and proper criteria.
Hungary Securities Capital Markets Licence
- All companies engaged in i) issuing securities ii) acquisition of a public limited company iii) provision of trading activities on any stock exchange iv) central securities depository v) clearing house activities vi) advisory & marketing related to securities investment and vii) fund management related services, must obtain MNB authorization;
- Except for government securities, only registered, dematerialised securities can be offered to the public;
- Executive officers of the company must i) have a college or university degree ii) have at least three years’ professional experience in finance, and three years’ managerial experience in finance and iii) produce proof of no prior criminal records;
- A certified auditor and statutory audit are required.
Hungary Insurance Licence
- All insurance and reinsurance activities are regulated by MNB;
- MNB will assess i) whether appropriate governance systems are in place ii) the minimum guarantee fund (depending classes of insurance) iii) facilities for record keeping iv) infrastructure and security of premises and v) internal and compliance policies;
- The minimum operations fund requirement is i) €280,000 (100 million HUF) for limited insurance and reinsurance companies ii) €140,000 million (50 million HUF) for co-operative insurance and reinsurance companies and iii) €3,000 (one million HUF) for mutual associations;
- The minimum capital requirement is dependent on the class of insurance. The minimum is €1.2 million for captive reinsurance companies, and €3.7 million for life insurance.
Hungary Payment Service Providers Licence
- Payment institutions, including money remittance payment service providers, must obtain MNB authorisation to conduct business in Hungary;
- To obtain authorisation, the company must submit i) a detailed business plan covering the first three years of the business including the infrastructure plan ii) accounting and risk management system plan iii) details of executive directors, management team and auditor and iv) Anti-Money Laundering (AML) policy;
- The minimum capital requirement for payment institutions is 37.5 million HUF (€110,000);
- All employees are must fulfil i) qualifications ii) skills and iii) credentials criteria outlined in section 57 of Act CCXXXV of 2013.
Hungary Asset Management Licence
- All companies engaging In portfolio management services must obtain MNB authorisation before conducting businesses in Hungary;
- For investment firms dealing in portfolio management but not trading in their own account, the minimum initial capital is €125,000;
- In addition to capital requirements, the company must show it has the necessary i) internal controls on risk management ii) senior management is fit and proper and iii) physical office;
- Asset management firms whose balance sheet for the previous year is above 200 billion HUF (€560 million) are required to establish a nomination committee. These individuals are members of the management body on supervisory functions, but do not perform any executive function in the investment firm;
- The nomination committee’s role is to identify and recommend candidates to fill management body vacancies and evaluate the knowledge, skills and experience of individual members of the management body.