Poland plans changes to mortgage bond laws
December 31, 2013
Poland wants to introduce changes to the law on mortgage bonds and mortgage banks that would facilitate investments in mortgage bonds by institutional investors, the government said in its legislative work agenda.
"The bill will modify the current investment limits for financial institutions in order to increase capacity of investing in mortgage bonds by institutional investors on the domestic market," the government said.
The new law would introduce collateral mechanisms. It would also allow for treating provisions for loans purchased by a mortgage bank as a tax cost. To date, only the loans granted by such banks allow for treating such provisions as a tax cost.
The regulations should unleash potential cumulated in mortgage loans granted by regular banks. According to Polish law, only special-purpose mortgage banks are allowed to issue mortgage loans.