We have completed our review of systemic risks in Hungary's banking sector, after raising our long-term sovereign ratings on Hungary to 'BB+' on March 20, 2015. In our view, economic risks for banks in Hungary are diminishing, and the correction in the domestic real estate markets is bottoming out. Therefore, we anticipate that Hungarian banks' creditworthiness will improve, deriving support from a lessening number of new problem loans. We are revising our outlooks on OTP Bank PLC, OTP Mortgage Bank, and Takarekbank to positive from stable and affirming our ratings on the three banks. The positive outlooks on the three banks mainly reflect our expectation of a more benign operating environment in Hungary and improvements in their risk positions. PARIS
