(MENAFN- AFP) Hungary slapped on Wednesday a record fine for 11 banks, including local branches of Citibank, Austria's Raiffeisen and Italian Unicredit, for cartel activities during a recent debt repayment scheme.
The banks, which also included branches of Erste Bank and BNP Paribas, were fined a total of 9.5 billion forints (32 million euros, $43.2 million), said Hungary's competition authority GVH.
It said the lenders "coordinated their strategies and exchanged confidential information to delay and prevent the introduction of replacement loans needed to finance foreign-currency-denominated debts between September 15, 2011 and January 30, 2012."
"Because of the banks' conduct, tens of thousands of people could not take advantage of the loan repayments at preferential rates," it added.
In September 2011, the government introduced a controversial programme allowing Hungarians who took out mortgages in foreign currencies to repay them early and at artificially advantageous exchange rates.
Such loans, especially in Swiss francs, had been very popular before the 2008 global financial crisis but the sharp fall in the forint left many Hungarians struggling to repay their debts.
Hungary's number one bank OTP said Wednesday it planned to challenge the ruling in court, while Erste Bank said it was considering legal action. Most of the others said they were still examining the ruling.
The government's repayment scheme already drew fire when it was passed, from the European Central Bank but also from the European Union and Austria since EU and notably Austrian banks have a strong presence in Hungary.
An investigation into allegations of cartel activities was launched in November 2011 following a complaint by a member of Prime Minister Viktor Orban's ruling party Fidesz, Antal Rogan.
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