The Swiss Financial Market Supervisory Authority (Finma) warns of the dangers posed by the Swiss mortgage market for financial institutions.
05.04.2022 14:20
"A correction of the real estate markets represents a cluster risk for our economy, and especially for highly exposed institutions," said Finma Director Urban Angehrn. Nevertheless, the stability of Swiss financial institutions is assessed as good by the supervisor.
Finma is "very skeptical" about loosening supervisory law for the mortgage sector. "Such relaxations would further increase the already significant risks in the market today," it said in its 2021 annual report, which Finma presented on Tuesday.
No widespread threat to financial market
Moscow's invasion of Ukraine, however, "does not pose a widespread threat to the stability of the Swiss financial market," the financial regulator said.
However, there are risks in this regard: For the Swiss financial sector, they are "manifold", for individual institutions "selectively accentuated". For 22 years, low interest rates, low inflation and stable economic growth have supported the real estate market. However, the war in Ukraine has now changed these conditions to the negative, which is now clouding optimus in the real estate business.
Source: (Bloomberg/cash)