August 7, 2015 / 7:37 PM / 4 years ago

Polish president considers his own Swiss franc mortgage bill

KRAKOW, Poland Aug 7 (Reuters) - Poland’s president said on Friday he would consider drawing up his own draft bill aimed at resolving a Swiss franc mortgage crisis that has become one of the main points of political debate ahead of October’s parliamentary elections.

More than half a million Poles took out home loans in Swiss francs, mostly between 2007 and 2008, hoping to benefit from low interest rates. Since then, the franc has risen more than 80 percent against the zloty, increasing repayments and trapping some owners in homes with values below the zloty market price.

President Andrzej Duda, who is backed by the Law and Justice (PiS) party tipped to win power from the ruling Civic Platform in the parliamentary elections, campaigned in May’s presidential election for the mortgages to be converted into zlotys at the exchange rate in use when the loans were taken out.

Some estimates put the cost of his proposal at up to 64 billion zlotys ($17 billion).

“I will be thinking about it,” Duda told reporters, when asked if he would prepare his own draft bill aimed at helping Swiss franc mortgage holders. He was sworn in on Thursday.

On Wednesday, parliament approved a draft law that would allow some Swiss franc mortgage holders to convert their loans into zlotys, mostly at lenders’ expense. Analysts estimate the cost for banks would be $5 billion.

Asked if he would sign that bill, Duda declined to answer directly, saying the bill was still subject to further debate in both the upper and lower chambers of parliament.

Polish bank shares recovered some losses on Friday, after tumbling between 6 and 24 percent on Thursday.

The industry, which includes PKO, BZ WBK, mBank, Millennium, and BPH, holds Swiss franc portfolios worth some 144 billion zlotys, or 8 percent of Poland’s gross domestic product.

$1 = 3.8354 zlotys Reporting by Wojciech Zurawski; Writing by Marcin Goclowski; Editing by Mark Potter

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