International Forex Inforamtion

BUDAPEST, Oct 4 (Reuters) - Hungary's central bank (NBH) has proposed regulations to the government to limit foreign currency lending, national news agency MTI said on Sunday, quoting NBH Governor Andras Simor.

An NBH press officer confirmed to Reuters that the bank had proposed loan-to-value and payment-to-income limits to cut the risk of non-payment as exchange and interest rate fluctuations can boost payments for households with foreign currency loans.

According to the proposals, the loan-to-value limit in mortgage lending would be 54 percent for euro loans and 35 percent for other foreign currencies. Monthly payments would be limited to 23 percent of the income of low-income households for all euro loans and to 15 percent for other foreign currencies.

"The new rules, which cut the country's financial vulnerability, could somewhat slow future economic recovery in the short term, but would lead to growth in a more healthy structure, and could even lift growth in the long term," the press officer said.

(Reporting by Sandor Peto; editing by John Stonestreet)