In December 2024, Central Bank of Hungary (MNB) according to its regular practice reviewed its expectations and methodologies for the ICAAP1 and ILAAP2 processes and their supervisory review, in addition for BMA3 and issued an updated manual4 for supervised institutions. In addition to the revision of content, the MNB also changed the usual structure in previous years, so some chapters were placed elsewhere. The renewal of the structure was probably necessary due to a more logical structure. Among the more significant content changes, the IRB shortfall related to credit risks, the methodology for determining the capital requirement of the IRRBB, and the part concerning the calculation of the capital requirement for operational risk deserve mention. As usual, the annual review and refinement of the measures for preferential capital requirements for green loans was carried out, and the minimum requirements for the institutions’ internal stress test were supplemented with the expectations of the climate risk stress test. Following the annual update of the MNB, KPMG experts analyze and present the main changes for the sixth year now, and in connection with this and similar topics, we recommend our April 2024, February 2024, March 2023, November 2022, January 2022, and February 2021 newsletters
