I. Professional experience
1. Director of the World Bank, 1996-2004
Private and Financial Sector Development,
Financial Advisory Services
Europe and Central Asia
While working at the World Bank for more than five years I was involved in assisting governments in the transition world to design and implement a wide variety of private and financial sector development strategies and programs, including the restructuring and privatization of individual enterprises and financial institutions. In addition to manage private and sector work in the 26 former communist countries between 1997 and 1999.
2. Minister of finance, 1995-96
Government of Hungary
Hungary was on the verge of financial collapse at the beginning of 1995 (soon after the Mexican crisis) and the government was obliged to introduce a comprehensive program of financial stabilization. The austerity program designed by the MoF was based on four distinctive elements: (i) a sharp devaluation of the national currency and the introduction of a preannounced crawling peg exchange rate mechanism, (ii) revenue enhancing measures including a temporary import surcharge, (iii) a sharp decline in real wages in order to regain international competitiveness (iv) public finance reform, reducing and targeting social transfers, starting pension reform, etc. The successful implementation of this package resulted in a complete turnaround of the Hungarian economy within a very short period of time and now it is widely recognized as a uniquely successful stabilization without recession.
3. Chairman and CEO, 1991-95
Budapest Bank, Hungary
Budapest Bank was created in 1987 as the third largest state owned bank carved out of the former central bank. After the political changes in 1990 and 1991 all state owned banks were technically insolvent and needed heavy handed restructuring. Budapest Bank was the first to set aside all its profits to loan loss provisions and implement tough measures on asset classification and liquidity management, cost control, internal audit, management information system, integrity, etc. As a consequence, out of the new state banks, BB was the first successfully privatized to a reputable foreign strategic investor, i.e. General Electric Capital in 1995. The bank was also instrumental in the restructuring, liquidation and/or privatization of many of its corporate clients byts workout subsidiary. BB has become market leader in new products, such as leasing, SME-finance, fund management, etc. and attracted a lot of new, creditworthy customers.
4. Chairman and CEO, 1990-95
Budapest Stock Exchange, Hungary
As the first chairman of the newly reopened Budapest Stock Exchange I was leading and directing comprehensive efforts to recreate a well functioning capital market in Hungary after 42 years of absence. I was personally involved in designing and implementing new legislation, bylaws, regulation and supervisory schemes for the capital market as a whole. In addition, I was leading efforts within the Stock Exchange to create and introduce good mechanisms for listing, trading, price formation, information dissemination, clearing and settlement, market watch and surveillance. We cooperated with the financial authorities on formulating and fine tuning rules and regulation on public companies, disclosure, fund management, taxation, foreign portfolio investment, currency convertibility, insolvency, and achieved first immobilization then dematerialization, established a central clearing and depository corporation, created derivatives markets, options and futures, etc.
5. Director, member of the board, 1990-91
State Privatization Agency, Hungary
After the political changes in 1989-90 the Government started a comprehensive program of privatization which was managed by a central government agency. As a director I was participating in designing and implementing dozens of large transactions as well as the formulation and execution of simplified privatization programs for small and medium size enterprises. I was instrumental in fighting both spontaneous privatization and mass privatization programs as I was convinced those would not bring in new capital and good management. Secondary public offerings, however, were promoted in case of the best known and largest companies, including the public utilities. We put special emphasis on attracting foreign direct investment and on the liquidation of non-viable firms.
6. Managing director, Capital Markets Department, 1989-91
Member of the board,
Deputy general manager, Economics Department, 1987-89
National Bank of Hungary
After the establishment of the two tier banking system in 1987 in Hungary the central bank was leading efforts (i) to establish a modern regulatory and supervisory system for the commercial banks and (ii) to design, implement and monitor the effectiveness of new instruments of monetary policy. Later I was also dealing with foreign debt management and involved in creating favorable conditions for foreign direct and portfolio investment. I was instrumental in the establishment and management of the first country funds for Hungary and worked with the IFC and EBRD on specific investment projects. At this time I was also a member of the business advisory council of the executive vice president of IFC. I was in charge of formulating domestic capital markets regulation and rules for the corporatization of state owned enterprises at the time of political transition.
7. Research fellow, 1980-86
Chief, Public Finance Division, 1986-87
Financial Research Institute,
Ministry of Finance, Hungary
I was first preparing studies on financing public investments, housing finance, later more broadly on fiscal issues, taxation, and monetary affairs. I was assigned to write programs on macroeconomic stabilization, government structure, IMF-style financial programming. This type of research proved to be instrumental in formulating the first comprehensive reform program in Hungary which highlighted the need for political changes as well. As a consequence, the Institute was dissolved by the then minister of finance in late 1987.
II. Teaching experience:
IV. Selected publications
In: Privatization in Eastern Europe: Current Implementation Issues, International Center for Public Enterprises in Developing Countries, 1991, Ljubljana, Slovenia
In: Privatization in Transition Process, Recent Experience in Eastern Europe, UNCTAD – Kopint Datorg, 1994, Budapest, Hungary
In: Systemtransformation in Mittel und Osteuropa und Ihre Folgen fuer Banken Boersen und Kreditsicherheiten,Verlag Mohr Siebeck, 1998, Tuebingen, Germany
In: Financial Crisis Management in Regional Blocks, Kluwer Academic Publishers, 1998, Norwell, Massachusetts, USA
(co-edited with Jean-Jacques Dethier), The World Bank, 1998, Washington DC, USA
Finance a Uver, Charles University, 2001, Prague, The Czech Republic
(co-edited with Alexander Fleming and Cari Votava),The World Bank, 2001, Washington DC, USA
In: A Decade of Transition: Achievements and Challenges, International Monetary Fund, 2001, Washington DC, USA