# They reach of expression, among others Polish Bank Association President Christopher Pietraszkiewicz and Deputy Minister of Finance of Isabella Hazel #
03.02. Warsaw (PAP) – The situation arising in connection with loans in Swiss francs correspond to both banks and borrowers, so both should assume the cost of solving this problem – said Tuesday the head of the KNF Polish lucky.
During Tuesday’s dedicated to the situation frankowiczów meeting of the Committee of Public Finance Jakubiak explained that occurred with its proposal once the conversion of loans in Swiss francs, because the situation of rapid growth in the cost of servicing these loans, “raises systemic risk.”
Conversion – as he said – it should be a one-time and voluntary; both sides, both the borrower and the banks should get along with each other. “Parties must see to it that such a transaction they want” – he said. He added that he hopes that the banks will understand.
This operation should be – according to Jakubiak – neutral for the budget and tax neutral for borrowers.
Jakubiak presented the details of the proposal, which was developed in the NFC and “based on international standards.”
“We value the debt in Swiss francs and recalculate the value of the current average rate of NBP” – he said. Then – he added – loan is divided into two parts: a loan secured by mortgage and mortgage-credit unsecured.
“The loan is secured by mortgage bears interest on the same terms, which gave the bank the day when the original loan was granted francs” – he said.
“The second part of the difference between the current and the prior debt obligation in respect of the relevant mortgage” – he said. This difference unsecured loan is a mortgage. “The interest rate on the loan will be unsecured mortgage-1 percent and will be fixed” – explained Jakubiak.
The deadline for repayment of unsecured loan with mortgage “is consistent with the deadline for a mortgage loan.” The loan is to be repaid, but in the middle of the borrower, and half canceled. “Bank makes redemption in accordance with the repayment schedule.” “Redemption takes 50 to 50, and for every thousand repaid by the customer redeems the bank a thousand” – explained the head of the Polish Financial Supervision Authority.
“This is a proposal that eliminates systemic risk” – said Jakubiak. “I do not give you the satisfaction of all, but at least it breaks the cost in time” – he said.
He added that, in accordance with the proposal francs borrower will not be privileged to the one who took loans in US dollars. He added that his proposal presented by Prime Minister Ewa Kopacz and “met with understanding”.
According to Jakubiak cost of this proposal for banks spread out over 20 or 25 years, “it is 7 per cent of the financial result that banks are making.” “This is a proposal that is broad-based and can be the basis for talks with the banking sector,” – said the chairman of the Financial Supervision Authority.
Jakubiak said that “the situation is not frankowiczów dramatically bad” because it is a low interest rate, and banks have lowered spreads.
However – he explained – if someone eg. In June 2008. Took a loan of EUR 300 thousand. zł, today “borrower debt dropped to PLN 267 thousand. zł, and the borrower’s debt in francs increased to EUR 450 thousand. zł.” “As we are deprecating [gold] of 15 January 2015., This amount is even higher and amounts to approx. 500 thousand. Gold” – he said. “This is the genesis of the problem, which they say today Frankowicz to which you need to be addressed,” – he added. “After 5-6 years of regular repayments have higher debt than credit, which enlisted” – emphasized.
He explained that he had submitted his proposal, because his media statement two weeks ago, when I first reported this idea, sparked “great confusion”. “That’s why I said that? The role of the supervisor is to prevent systemic risk” – he said. “I read with amazement that lost my mind” – he added.
The threat system, according to Jakubiak, through inter alia that “banks artificially increased their assets”, and there are more and more class actions in which the complainants argue that banks have put them in error.
The head of the Financial Supervision Authority also explained the circumstances in which there was a problem occurs with the loans in Swiss francs. Reported that in 2006-08 there was a very large increase in the number of loans denominated in Swiss francs, in 2008. 70 percent. loans were denominated in this currency. Sometimes the rules for granting these loans were “too liberal” – he said.
He explained that banking supervision is not przypilnował then to these loans was not too much, because the years 2006-08 were a time of formation of new structures of financial supervision, banking supervision and he went to the Polish Financial Supervision Authority (established in 2006 .) only from 1 January 2008.
He explained that from 2013 onwards. KNF introduced provisions under which loans can be taken only in the currency in which it earns. Today, more than half of the loans are in US dollars, while the franc approx. 37 percent. PLN loans, as explained, is “stable and well paid.”
During the committee meeting also spoke Mateusz Szczurek finance minister. He argued that the government is most interested in ensuring that solved the problem loans frankowych stakeholders. He announced that the government will publish a list of banks that provide the best deals for borrowers. Only when these measures are insufficient, the government is allowed to take “regulatory action”.
President of the Polish Bank Association Krzysztof Pietraszkiewicz referring to proposals KNF said that it requires reflection and thought. In his analysis of the need to take into account that the loan agreements were concluded for several decades. “Therefore, there may occur different situations with regard to the Swiss franc. So we avoided the situation in which we encourage people to perform certain operations, in which they take on the financial responsibility, but after a while it turns out that overlook this is not the best, “- the head of the PBA. This could occur if, in the future franc depreciated considerably.
He stressed that the proposal KNF assumes that banks and their customers would share the risks and costs. “If this were to occur, I think that in this whole affair is more participants than the customers of banks and the banks themselves. I recall that both banks and banking supervision suggested to prohibit the offering of foreign currency loans in the Polish market. As a result , I believe that if there have to charge any costs, these costs should be tighter spread, not only between the customers of banks and banks, but also between the NBP, a little between the government and the state, and some between the Bank Guarantee Fund “- rated.
He noted that if you consider that on some mechanism failed, it means that failed too – at the beginning of the last decade – the whole financial system safety net. Because it was not more radical, decisive steps. Pietraszkiewicz added that since 2006. Compulsorily all customers are informed about the risks and all customers were offered first mandatory PLN loan.
“We are faced with the paradoxical situation that the biggest problems are with this group of customers, who already knew about the risks and consciously undertook the risk, and now would get the most help. So you have to act prudently here (… ) to avoid, in turn, to the fact that the borrower would have to feel Złotowie (…) treated very unfair by the banking sector, but also by the state, “- he said. He added that the banks have already established rules that ensure that in the coming months franc loan repayments will be higher than before the decision to release the SNB franc.
Bozena Szydłowska the OP asked, inter alia, about whether and what action to take the Financial Stability Committee, which consists of the Minister of Finance, President of the NBP, the FSC Chairman, President and CEO of the OCCP BFG. “In the light of the existing risks and the experience you foresee any system solutions?” – Asked.
Wieslaw Janczyk PiS noted that as a result of the decision of the SNB commitment Polish borrowers increased by approx. 30 billion zł, half a million borrowers and their families, “survived the horror.” Indicated that they expect “to the real, real good solution that will allow everyone to be aware that the state works.” MP said that the Law and Justice considers that the rules allow to legally recognize that the SNB decision led to the extraordinary economic circumstances change and give the opportunity to convert liabilities at the exchange rate before the SNB decision.
“The issue of housing loans (…) shall be governed by political divisions. Just as important, important for the development of the Polish economy element sector of the market” – said John shovel with the PSL.
On the other hand, Sławomir Kopycinski TR pointed out that the borrowers situation is unstable and unpredictable, and this translates into a lack of stability and predictability of the entire banking sector. “There is a risk to the stability of the system” – he believes.
Deputy Finance Minister Izabela Hazel said that the Ministry of Finance will closely monitor all proposals, even one that at first glance appear to be risky – as shown by the KNF. “All ideas aimed at finding the best solutions to consider and take into account. For the Minister of Finance is extremely important, what will be the cost of these solutions,” – said the deputy minister. She added that it is also equally important balance between borrowers and borrowers franc in gold, but also the balance between borrowers and taxpayers.
Hazel stated that, if taken so far by the banks activities (eg. Taking into account the negative LIBOR or reduce the spread) will prove to be ineffective or are not properly implemented, the Ministry of Finance will consider taking regulatory initiatives.
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