Swiss Central Bank (SNB) took the unprecedented decision, and from January introduces negative interest rates. There are theories that the banks will be forced to pay extra Poles to loans taken Helvetian currency. Is this really be?
However, the problem is not Swiss, but the fall in interest rates is information that most interests the Poles. That it means is smaller installments of loans taken Helvetian currency.
How many will benefit from the Poles, and how much they will lose the bankers on SNB decision? It may be that, contrary to appearances, not much.
– The fact that the central bank changes its interest rates does not necessarily mean that the market rate will change radically. Even if it becomes negative, most loan agreements do not allow the possibility that the borrower to the bank dopłacał commitment. If the rate is positive, the client pays the premium plus interest, and if negative, the same margin – notes Przemysław April, chief economist at the brokerage house X-Trade Brokers.
However, if the new contract is not the problem, then, as noted by “DGP” banks that grant loans in Swiss francs a few years ago such a possibility przywidywały not as negative interest rates. Therefore, after the change of the customer will not only pay less, but theoretically can get subsidies in the next major reduction.
The Journal reported that the Polish Bank Association even created a special team that has a common position on the banking industry “frankowców”. However, Dr. Przemyslaw Barbrich with PBA, strongly denies this information. Admits only that of negative interest in the environment to talk, but it is a natural thing.
How is the interest calculated?
The interest rate on a home loan usually consists of two parts. Fixed margin of the bank and variable market interest rate. In the case of mortgage loans franc takes into account the majority of Polish banks 3M or 6M LIBOR. Although the recent decision of the SNB these rates are still above zero, it really slightly. On Friday, December 19th was the value of 3M LIBOR at 0,007 percent. What happens, however, when the rate drops below zero?
– In the case of our bank when they reach the 3M LIBOR we consider it a negative value in the interest rates on loans – secured Aneta Styrnik-Cornflower of PKO BP press center in “DGP”.
The newspaper found that such a position also has several other banks, which until now have granted loans in Swiss francs. However, there are those that for some time now add to their contracts a provision that in the event of a negative interest rate the bank applies to “0″. So from the end of 2012, for example, is progressing. MBank. But as provides Krzysztof Olszewski, a spokesman for the institution, in the case of older contracts will take into account interest rates fall below zero.
The lower rate of a little change?
At the end of October 2014. Denominated in francs was 33 percent. of all mortgage loans granted to households, worth 129 billion zł. The case concerns approx. Half a million Polish families. Negative impact on the reduction of the rate of interest on these loans.
– The fact that the interest does not fall below zero indicate two conditions. First of all – the legal definition of a loan, which provides that it is to provide a certain amount for a certain time, for a fee in the form of commissions and interest. Secondly – it is that the margins in contracts for loans in Swiss francs were less than 1 per cent., While a negative deposit rate is 0.25 percent of the SNB. – Comments Frączyk.
Our analyst notes that the course theoretically CHF LIBOR, which is determined by the interest rate may fall below 1 percent. However, this is highly unlikely. – We need to keep this version so that the interest on loans frankowych fall, but definitely not as much to the bank instead of downloading, have the customer pay them himself – adds Frączyk.
What would happen if the Swiss did not intervene
An independent analyst Halina Kochalska states that the decision of the central bank of Switzerland can – but need not – translate into a decline in interest rates on loans taken out in Swiss francs, which would be a consequence of the further decline in LIBOR. Some banks in the event of a negative Libor assume that it amounts to zero, and the “no less”, and from that level to charge their profit margin.
According to her, even if interest rates on some loans will fall, it does not translate into benefits especially for borrowers. At most, help neutralize rat higher costs associated with a strengthening currency exchange Helvetian. For now, nothing indicates that the franc had indeed get cheaper.
– Gold in recent days loses against major currencies, including the CHF. It is difficult to imagine a situation in which the borrower would be indebted franc, the Swiss central bank had not intervened to defend the franc against excessive appreciation – not decreased feet and did not try to keep the exchange rate peg to the euro – Kochalska said.
From Thursday 18 December, that the decision of the SNB, dollar weakened against the CHF by 0.6 percent. in relation to the risks that flows to us from the East and the possibility of a reduction in interest rates by the Polish MPC. The benefit of 0.5 percent. at the rate it was necessary to atone for the loss of 0.6 percent. on the course. Many things had to change, so nothing has changed.
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