REFORM AND FINANCIAL INSTITUTIONAL SYSTEM IN HUNGARY

As a part of the further development of the system of economic control, it is indispensable to modernize the system of financial institutions. The whole banking system is one-sidedly subordinated to the mainly natural plan-decisions and to the state budget. On the other hand, the subordination of the banks within the central hierarchy of economic control is reflected towards enterprises as dependence on state administration. After outlining the main types of proposals for transforming of the banking system the authors briefly expound their own standpoint. The most important thing is to secure a relative autonomy for the role and institutions of monetary policy. In the long run also the establishment of a two-level decentralized system of competing banks is necessary which would secure an actual possibility of choice for every income-holder. For the' short run the authors make a proposal for such transitory measures which partly take into account the existing restrictions, and partly promote an activity of the financial institutions based on interest in income.