It may be more than repeated in the next period to write about bank acquisitions on our blog, as not only was the Daisy transaction announced today in the air, several other banks may disappear. So, here’s what happens when you buy your bank. No need to worry as your money will always be paid back and your credit will be paid to whom.
The state buys Daisy. This is likely to change nothing in the life of the bank’s existing customers. Now even the logo may remain, and even existing offers will probably not be renewed. Likewise, today’s news is that the Managing Director of the Mary Bank estimates that it will be 3-4 banks less in Hungary within a few years. Most of them will be dissolved through mergers and acquisitions, which is different from today’s one, with the complete disappearance of a bank and the creation of a large single credit institution. Daisy is likely to remain in the hands of the state for a long time to come.
You pay your loan the same way
But not only because the state buys the bank, nothing changes. The same would have happened if OpenEarn had won the bidding war. Existing contracts are always transferred to the new owner. In the case of a new owner, the terms of existing contracts may change only if permitted by the law on credit institutions.
Unilateral changes to a customer’s loan agreement may occur in the following cases:
- change in the legal, regulatory environment,
- financial market conditions, changes in the macroeconomic environment,
- a change in the customer’s risk perception.
You also get the interest
We do not have to worry about our money, as our deposits are up to $ 100,000 protected by the OBA, ie the National Deposit Insurance Fund, while our investments managed by investment funds are guaranteed by BEVA.
But not even these warranties do not have to be afraid of an acquisition, but because the whole operation is a controlled process, the acquisition can only be done in accordance with the law. Nothing is lost in this deal. The depositors’ money will not disappear, but will be transferred to another bank, which will have to pay interest on the original terms.
Account managers and other clients are not at risk, as are creditors and depositors. For a long time everything may remain the same. In the long run, of course, a merged bank will unify its strategy, which may result in the loss of services or the transformation of an entirely new one. Any such changes will be notified to the bank 60 days before they become effective, and it will be a good idea to decide whether to switch.
Is it bad for us to have fewer banks?
Of course, any event that reduces competition in the Hungarian market is bad. With one bank less, one choice disappears. In our opinion, it is difficult to imagine that only a larger banking sector would be more competitive than at present. Of course, it is a matter of all circumstances, as the current transaction tax is more harmful than the purchase of Daisy. It is certain that the lack of competition will start customers’ wallets, services may become more expensive and opportunities may disappear.