EUROZONE : ECHOES OF THE CRISIS.

Hungary: Informal meeting with IMF next week: Hungary's negotiator Tamas Fellegi will meet Christine Lagarde, the French director-general of the International Monetary Fund, on 11 January in Washington DC for informal talks with an eye to a credit application by Budapest, according to an official Hungarian source. "Tamas Fellegi, minister without portfolio, will be in Washington on 4 January for an informal meeting with the director and other executives of the IMF," announced the minister's press service, on 2 January. The announcement came shortly after the country's parliament passed two constitutional laws, on 30 December 2011, which entered into force on 1 January, one strengthening the government's influence over the central bank (MNB) and the other writing the flat rate (16%) income tax into the new constitution. Exploratory discussions in Budapest between the IMF and the European Union were interrupted sooner than planned in mid-December on the initiative of the IMF and the EU after a letter from European Commission President Jose Manuel Barroso, calling for the withdrawal of the two bills, went unheeded. The EU-IMF duo has not yet announced a date for an official resumption of the negotiations, which could concern a credit line of 15 billion to 20 billion, since the adoption of the two new laws.

Greek central bank (BNG) issues 1 billion in new share capital to the state: The Greek central bank (BNG) announced, on 2 January, that it had increased its share capital by 1 billion through the sale of preferential shares to the state to cushion the losses expected from the planned write-off of part of the sovereign debt. "The Board of Directors took note of the payment of the amount of the capital increase [...] with the issue of 200 million preferential shares covered in full by the state," the bank announced in a statement. The transaction, announced in December 2011 by BNG, "strengthens the capitalisation ratios by 1.5%, which will bring the core tier one ratio to over 11%" compared with 9.5% in December, it added. BNG proceeded with the capital increase on the basis of a law on "reinforcement of the economy's liquidity" adopted in 2008 during the international financial crisis. Following the transaction, BNG's capital adds up to 6.1 billion, consisting of 956 million in ordinary shares worth 5, 25 million preferential shares without voting rights worth 0.30, and 270 million preferential shares based on the 2008 law worth 5, announced...