Sejm passes CHF-denominated loans conversion bill

Sejm, Polish lower house of parliament has passed a law restructuring franc-denominated mortgages with 281 votes for, 2 against and 150 abstaining.

According to the law, the franc-denominated mortgage loans would be converted to PLN with the exchange rate of the CHF recorded on the day of the conversion. Banks will take on 90 percent of the costs of such convertions. Those owning apartments up to 100 sqm, and houses up to 150 sqm, would be eligible, under the condition that the real estate is actively used by the borrower. Such limitations would not apply to families with three  or more children. During the first year of the program the first beneficiaries would be borrowers whose mortgage value exceeds the value of loan security by 120 percent. In May, Poland's Bank Association signed the establishment of the Mortgage Restructurization Fund and internal stabilizing funds. Thus,  Polish banking will commit up to PLN 800 million to support mortgage borrowers this year. According to brokerage Trigon, the new law will cost the lenders up to PLN 19 billion.