The Polish Bank Association estimates that in the loan conversion scenario, in line with the assumptions of the KNF Chairman’s proposal, the costs for the banking sector would amount to PLN 30-57 billion, according to a study prepared by the Research and Analysis Team of the Polish Bank Association. The Polish Financial Supervision Authority previously estimated the cost of settlements in this scenario at PLN 34.5 billion.
According to the estimates of the Polish Bank Association, in the event of cancellation of the loan agreement, but with the return of capital costs for banks would amount to PLN 107-111 billion (KNF estimated them at PLN 101.5 billion), and in the variant with the return of capital costs – this cost would amount to PLN 33-52 billion (according to KNF calculations it would be PLN 70.5 billion).
In the variant where the bank returns the installments received from the customer, while the customer is released from the obligation to return the principal and interest on the loan, costs for banks are estimated at PLN 211-225 billion. The Polish Financial Supervision Authority estimated the costs of banks in this scenario at PLN 234 billion.
The Polish Bank Association also presented an estimate of costs in a scenario in which the outstanding amount in Swiss francs is converted into zlotys at the average exchange rate on the date of granting the loan, and the remaining loan amount is repaid at 3M WIBOR. The bankers estimate the costs of this scenario at PLN 50-59 billion.
The least expensive scenario is only PLN 6 billion
According to the estimates of the Polish Bank Association, the scenario in which the loan would be recalculated would be the least expensive (PLN 6bn), would be repaid at the average NBP rates (excluding bank spreads) and bearing an interest rate of 3M LIBOR.
In December 2020 the chairman of the Polish Financial Supervision Authority proposed to introduce a “sectoral” solution in terms of risk related to foreign currency mortgage loans.
The solution would be banks offering their clients the option of voluntarily joining agreementson the basis of which the client would conclude a settlement with the bank, as if his loan was a PLN loan from the very beginning, with interest at the appropriate WIBOR rate increased by the margin historically used for such a loan.
In response to the chairman’s proposal, an interbank team was established with the participation of the KNF Office and most bankswhich have foreign currency housing loans in their portfolio
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