Polish court sets stage for rulings on contested FX mortgages

Ipopema Securities SA

07/05/2021 16:15

WARSAW, May 7 (Reuters) - Poland's Supreme Court set the
stage on Friday for a hearing next week which is due to
determine how courts treat thousands of borrowers took out Swiss
franc loans more than a decade ago only to face ballooning
repayments when the zloty weakened.
    Seven judges responded to a question from the financial
ombudsman over cases where a loan agreement is deemed invalid,
ruling that claims made by Polish banks that extended foreign
currency loans and the client claims are separate issues.
    Banks and mortgage holders are awaiting a sitting on May 11
at which all the judges of the Supreme Court Civil Chamber will
answer six questions which are expected to decide whether banks
agree to sign up to a plan for settlements with clients.
    "The consumer and the lender are entitled to separate claims
for the reimbursement of cash payments executed in the
performance of the contract. The lender may request the return
of the money from the moment the loan agreement becomes
permanently ineffective," the court said in a statement.
    Deciding when the period during which banks can make claims
starts and ends is important in determining how big potential
losses arising from the mortgages could be.
    Polish financial market regulator KNF estimates that a plan
for settlements with clients that it proposed in December would
cost banks 34.5 billion zlotys ($9.21 billion). 
    However, it estimates the cost to banks from court cases at
70.5-234 billion zlotys.  urn:newsml:reuters.com:*:nL5N2L02NE
    The top European Union court said last week that national
courts should decide if foreign currency mortgage contracts
containing an unfair clause should be annulled.  urn:newsml:reuters.com:*:nL1N2MM0RQ 
($1 = 3.7471 zlotys)

 (Reporting by Anna Wlodarczak-Semczuk and Alan Charlish;
Editing by Alexander Smith)
 ((alan.charlish@thomsonreuters.com; +48 22 104 25 27 ;))