ING Bank Śląski. Housing loans – WIRON replaced WIBOR, the bank provided data

In mid-December 2022, ING Bank Śląski decided to suspend offering retail mortgage loans with variable interest rates based on WIBOR. The reason was preparations for the reform of reference indices, according to which WIBOR will be replaced by the WIRON (Warsaw Interest Rate Overnight) index. ING Bank Śląski’s offer includes mortgage loans with periodically fixed interest rates.

Then in June this year the bank resumed offering mortgage loans with variable interest rates. However, the interest rate on loans was based on the new WIRON 1M Folding Rate, and not WIBOR as before. ING Bank Śląski was the first bank in Poland to offer such a solution in the case of retail mortgage loans.

The bank’s margin is also included in the loan interest rate.

ING Bank Śląski announced on Thursday that in the third quarter of 2023 it granted housing loans for a total amount of PLN 1.980 billion. This means an increase of 22%. year to year and an increase of 8%. compared to the second quarter of this year.

For 80 percent Fixed-rate loans account for nearly PLN 2 billion. The remaining 20 percent this amount are loans with variable interest rates based on WIRON.

Work on the implementation of the new mortgage loan offer is also ongoing in other banks, including: in PKO BP, Bank Pekao, mBank, Bank BNP Paribas and Bank Millennium.

ING Bank Śląski reported that it had 13.5 percent. market share in mortgage loan volumes in Polish currency. This means that in the period from July to August 2023, on average, nearly every seventh mortgage loan was granted by this bank.

ING Bank Śląski previously explained that “due to the structure of the variable interest rate based on WIRON 1M Compound Rate, the client’s repayment schedule will change every month and take into account the changing amount of the index. This translates into a different installment amount each month.” This means that the installment may increase or decrease – depending on the change in the WIRON index. The higher the value of the indicator, the higher the monthly loan installment.

Currently, WIRON 1M Compound Rate is 5.00981 percent. For comparison, WIBOR 1M is 5.80%, WIBOR 3M is 5.66% and WIBOR 6M is 5.56%.

WIRON was to finally replace WIBOR in 2025. Steering Committee of the National Working Group on the reform of indicators at the end of October this year. extended the maximum deadline for implementing the reform until the end of 2027.