WARSAW, June 18 (Reuters) - Poland’s financial watchdog KNF stepped in on Tuesday to curb the issuance by local banks of foreign currency mortgages.
KNF’s newest recommendation, to come into force at the end of 2013 at the latest, urges lenders to issue mortgages in the same currencies as clients get their income.
The move is mainly to cut the share of mortgages issued in Swiss francs, popular among Polish homebuyers due to lower interest rates, which helped the loans stay attractive even in the face of a falling zloty currency.
At the end of last year foreign currency loans accounted for 55 percent and Swiss franc loans 45 percent of the overall mortgage portfolio of Polish banks which was valued at 319.5 billion zlotys ($101 billion).
Currently foreign currency mortgages account for only 1 percent of all new home loans, with only the more affluent standing a chance of getting one. ($1=3.1682 Polish zlotys) (Reporting by Marcin Goclowski; Writing by Adrian Krajewski; Editing by Greg Mahlich)