February 28, 2015 / 3:55 PM / 5 years ago

Polish holders of Swiss franc mortgages chide banks in Warsaw protest

Polish homeowners who have mortgages in Swiss francs demonstrate in Krakow January 24, 2015. REUTERS/Mateusz Skwarczek/Agencja Gazeta/Handout

WARSAW (Reuters) - Several hundred holders of Swiss franc mortgages demonstrated in Poland’s capital on Saturday, demanding banks ease the burden of these loans whose cost rocketed when the franc shot up last month following a policy shift by the Swiss National Bank.

Blowing whistles and trumpets, the protesters marched through central Warsaw, stopping at the finance ministry and financial regulator as they waved banners denouncing the banks for granting the mortgages.

“High instalments are affecting our lives, we have less money left to live on,” said Jakub Jedrzejewski, 37, while Barbara Husiev, 38, a widow with two children, said the initial 260,000 zlotys ($70,213) value of her Swiss franc mortgage, taken out several years ago, had risen to 407,000 zlotys, forcing her to take on two jobs.

The Polish government, facing an election this year, has proposed a relief scheme that would involve banks cutting interest rates, but has ruled out a Hungary-style forced conversion of the mortgages into zlotys at historical rates.

The head of Poland’s competition watchdog told Reuters in February that banks were careless when granting Swiss franc mortgages and should offer borrowers more relief.

Many of the 550,000 Swiss franc mortgages held by Polish households were taken out before the 2008 start of the global financial crisis, when the franc cost as little as 1.95 zlotys.

Now the currency trades at about 3.90 zlotys and the mortgages account for about 9 percent of Poland’s gross domestic product. CHFPLN=R

After new regulation from the financial watchdog in recent years, Polish banks have in practice stopped extending such loans.

Reporting by Pawel Florkiewicz; Writing by Marcin Goettig; Editing by David Holmes

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