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Housing loans. Banks introduce changes after the recommendation of the Polish Financial Supervision Authority – creditworthiness up

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Mortgage applicants can expect an increase in the amount of the commitment available. This is the effect of easing the conditions of creditworthiness testing by the Office of the Polish Financial Supervision Authority. Some banks have already introduced changes to their offer.

According to the recommendation of the KNF Office, so far banks had to calculate the creditworthiness of people applying for a mortgage loan, taking into account interest rates higher by 5 percentage points. Since April 2022, the Office of the Polish Financial Supervision Authority has doubled the required safety buffer, which previously amounted to 2.5 percentage points.

They’ve come to that interest rate increases NBP. From October 2021, during the year, the Monetary Policy Council raised the main, reference interest rate from 0.1 percent to 0.1 percent. up to 6.75 percent As a result, the creditworthiness of Poles dropped sharply.


Lending also slowed down. According to the data of the Credit Information Bureau, in January 2023, banks granted a total of 6.2 thousand loans. mortgage loans, which meant a decrease by 63.1 percent. compared to the situation in the previous year. According to BIK, this is the lowest result since January 2010.

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Interest rates and creditworthiness

However, at the beginning of February, the KNF Office informed about easing the creditworthiness assessment conditions. “The lowest, minimum buffer level (2.5 percentage points) should be used for loans with a temporarily fixed interest rate, and for loans with a variable interest rate, the buffer should be adequately higher,” Jacek Barszczewski, spokesman for the UKNF, told the Polish Press Agency.

The Commissioner for Human Rights reported that the Office provided the banks with information on the possibility of changing the minimum interest rate that should be adopted in the creditworthiness assessment process when granting loans bearing a variable and periodically fixed interest rate.

Will the February decision of the KNF Office revitalize the housing market? Several days after this information, we asked the banks whether they introduced changes in the calculation of creditworthiness, and whether there has been a greater interest in mortgage loans in recent weeks.

Banks make changes

Agnieszka Nachyła, responsible for mortgage loans in Santander Bank Poland, informed that the bank “lowered the level of buffers for the risk of interest rate increases used in assessing creditworthiness for customers applying for a mortgage loan”. “We introduced the change for applications registered from February 18, 2023” – Nachyła informed.

Santander Bank Polska sees “significantly greater interest in mortgage loans” in February. “The number of submitted loan applications has definitely increased compared to the very weak 4th quarter of 2022 or January this year.” – we read in the reply sent to us.

Alior Bank has also already “updated the level of buffers related to the risk of interest rate volatility and takes them into account in the assessment of creditworthiness”. For the time being, the bank notes “a slight increase in interest in mortgage loans”, which “does not differ significantly from the levels recorded in January this year”.

Alior Bank, similarly to Santander Bank Polska, did not disclose the amount of buffers, explaining that it is part of the bank’s internal credit policy. As regards the value of the adopted buffer values, we can only inform you that their levels were determined on the basis of the bank’s internal procedure for determining interest rate volatility buffers, while maintaining the supervision guidelines regarding the minimum buffer level, Alior Bank said.

mBank is working on the implementation of the new recommendation of the Office of the Polish Financial Supervision Authority. “We are working on the implementation. We do not have a fixed implementation date” – we were informed. mBank observes “an increase in the number of loan applications”. However, it was noted that “so far this is a typical recovery before the spring season”.

On the other hand ING Bank Śląski informed that “in the first weeks of 2023, the number of mortgage applications is similar to the number of applications submitted in the last weeks of 2022”. At the moment, the bank does not want to comment on issues related to the assessment of creditworthiness.

How much can creditworthiness increase?

Jarosław Sadowski, chief analyst at Expander Advisors, previously indicated – in the commentary to the new recommendation of the KNF Office – that reducing the buffer from 5 percentage points to 2.5 percentage points will increase the available loan amount by 19 percent. “This means, for example, an increase from PLN 269,000 to PLN 321,000 for a couple without children and with a net income of PLN 6,000” – he calculated.

In Sadowski’s opinion, “this is too little to significantly change the situation on the market.” “The increase is small because even with a lower buffer, mortgage interest rates are still high. In addition, the cost of living has increased, which banks must include in their calculations,” the analyst noted.

Main photo source: Shutterstock

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