Poland's new CHF mortgage stance seen as credit positive for banks - Moody's
February 17, 2017
Poland's seeming reversal of the approach to CHF mortgages conversion presented in recent comments from governing party Law and Justice (PiS) leader Jaroslaw Kaczynski is credit positive for Polish banks, Moody's rating agency said in a report dated February 16.
"Jaroslaw Kaczynski indicated that the government would not force the conversion of Swiss franc mortgage loans to Poland's local currency, the zloty, a reversal of the government’s earlier announced intention," the report reads. "The turnaround is credit positive for Poland’s banks because the initial conversion proposal would have reduced bank capital, investor confidence and lending."
Kaczynski's comments "increase the likelihood that the final framework for addressing Poland’s Swiss franc mortgage loans will focus on measures whose costs are significantly more manageable for banks," Moody's experts wrote.
Last Friday, Kaczynski said that CHF mortgage borrowers should seek justice in courts, as the government cannot accept systemic solutions that would hurt banks and, hence, all the Poles.
As for the proposals of the state financial stability committee KSF of increasing risk weights for FX mortgage exposures to 150% from 100%, Polish banks should cope with them without the need to raise additional capital, Moody's said.