The “Rescue Team” and Rescue Package (October–December 2008)

This chapter is devoted to the management of the 2008 liquidity crisis. The Hungarian Central Bank introduced several new measures, eased the collateral acceptance and reduced the haircut, reduced the required reserve ratio, galvanized the government paper market, and provided emergency assistance to individual banks, when needed. Even The Economist admitted: “The Hungarian Central Bank is impressively well-run.” These measures were well supported by the stand-by loan agreement with the IMF and the EU. Hungary was the first, but not the last on this road.