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Role reversal: Dutch mortgage borrower to be paid by bank
April 4, 2016 / 5:15 PM / a year ago

Role reversal: Dutch mortgage borrower to be paid by bank

AMSTERDAM, April 4 (Reuters) - In one of the more unusual side effects of negative interest rates, at least one Dutch household will be receiving, rather than paying, a mortgage payment from their bank.

In a ruling announced on Monday, the Netherlands’ consumer financial products watchdog, Kifid, said it had sided with the unnamed holders of the variable interest rate mortgage, who brought the case, rather than with lender Achmea NV.

The mortgage was denominated in Swiss francs, with a variable rate set at 0.7 percent above Swiss Libor, a benchmark rate.

When Swiss Libor fell below minus 1 percent in January 2015, the bank should have paid the mortgage holders around 0.3 percent interest, Kifid said in the ruling.

Instead, Achmea had told the customers they would not be charged anything.

Achmea spokesman Stefan Kloet declined to comment on how many customers could be affected by the ruling, or for how many months.

Achmea “has taken notice of the decision by Kifid,” Achmea said in a statement. “At the moment we are studying their justification in greater detail.”

The watchdog ordered Achmea to pay the customers back retroactively for the missed interest, and pay them 971 euros ($1,100) in travel and legal costs. ($1 = 0.8777 euros) (Reporting by Toby Sterling; Editing by Susan Fenton)

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