Banks scared of lawsuits? I do not think so. They can also wait for the franchisees' problem to die, forgotten by God and the world

Santander Bank Polska is working on the conversion of loans in Swiss francs, PKO BP is also thinking about a new offer for frankers, according to the information provided by Rzeczpospolita. Banks were clearly frightened by the growing number of lawsuits. Is this a breakthrough after all, or is it just a game of time?

More and more franchisees are losing patience and go to court. According to the data of the Ministry of Justice, almost 11.6 thousand new jobs were added in 2019. cases of franchise versus bank - it is as much as 60 percent. more than in 2018, when 7.2 thous. borrowers decided to go to court with a Swiss franc contract.

And let's remember that what was supposed to encourage the borrowers to fight the most is the judgment of the Court of Justice of the European Union, which was issued only at the beginning of October. Its effects are already visible in the statistics. In the fourth quarter of 2019, another 4 thousand. frankers sued their bank - it's 27 percent. more than in the third quarter. And probably as the number of winning cases increases, the next ones will dare.

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Some banks are not letting go and are fighting, especially fervently at the beginning of this road, to show clients that they will not give up so easily. Bankers know that each successive failed process will make the next dissatisfied clients fall into frustration.

But it turns out not everyone has adopted a strategy of going to court with every single client. Maybe they finally understood that it's time to deal with this problem more systematically?

Rzeczpospolita informs that Santander Bank was the first to choose a more peaceful strategy, which is working on a loan conversion offer.

Santander says: check!

What is Santander up to? Frankowicze, do not expect the bank to finally make your dreams come true. Certainly, there is no question that the loans will be converted at the rate on the date they were taken, in addition, with the negative LIBOR rate. Such things can only be promised by Andrzej Duda in the election campaign.

But at the same time, Santander's offer for fraction borrowers is to be something more than just a loan conversion at the average NBP rate, which is not a solution.

According to "Rzeczpospolita", one of the possibilities is to perform a simulation.

We convert, you dear client, your loan in francs into a loan in zlotys, which could hypothetically be taken by you instead of francs. We check what amount of installments you would pay if you had decided on a loan in PLN in the past and if it turns out that it would be lower than the installments you actually paid, we will refund the difference.

Such settlement would be converted into a PLN loan, which would be repaid on the basis of the WIBOR rate instead of the LIBOR rate. Let us recall that WIBOR3M is currently 1.7%, and LIBOR3M -0.7%.

If Santander really proposes such a solution, it means that it is telling its clients: I check! Because let's remember that despite the very strong increase in the Swiss franc exchange rate over the last few years, many borrowers still do not end up choosing the franc badly at all. Their installments are similar or slightly higher than if they had a loan in zlotys today, but for years they paid much less than zloty thanks to francs.

Whether customers accept this offer will show whether they really go out on Swiss francs like Zabłocki on soap and want to convert, or whether they just want to take the opportunity to win something for themselves now, if there is an opportunity.

The main problem remains

Thanks to Santander's solution, the exchange rate risk disappears, but the main problem remains. Unfranking causes the debt expressed in zlotys to grow, and in fact this is the biggest problem with the francs. People are trapped in their apartments, because selling them (if only because of divorce or willingness to exchange them for larger ones, because the family has grown) means realizing a huge currency loss. Often the sum to be given in zlotys is now greater than the value of the loan taken, despite its repayment over the years.

Who will take on this increase in debt after currency conversion? The Frankivskis would probably like to transfer this surplus to the bank. The bank would probably like the client to take it on, for example by extending the loan period in order to maintain the current amount of the monthly installment. The settlement Santander is working on should probably be somewhere in the middle.

Take your time, the patient will die

The solution Santander is working on would spare some people a long way to go to court. But for the bank, settling this matter quickly does not have to be beneficial, because it would cause very high costs and at the same time. This is a heavy burden and risk.

- I would be surprised if I saw the terms of the settlement that are attractive to the franchisees. Offering them a retrospective switch to zloty loans would be a high cost for banks, and it can be estimated at PLN 25-30bn in the entire sector

It mentions the entire sector right away, as Santander's solution could pave the way for other banks. Moreover, the unofficial information of "Rzeczpospolita" shows that PKO BP is also working on an offer for franchisees.

But such amounts accumulated over time could be an unacceptable cost for banks.

So what is it all about? Will Santander, when saying "I check", actually carry out an educational campaign among its clients to make them aware of specific figures that for most of them, loans in Swiss francs are not so unfavorable?

Or maybe the banks in this war are all about delaying the case? According to the data of the Credit Information Bureau, approx. 450 thousand zlotys are currently being repaid. loans in Swiss francs - it's about 13.3 percent. less than three years ago.

With each year, loans in francs decrease and will eventually become a marginal problem. And then they will no longer be an attractive topic neither for the media nor for politicians, and the matter will die a natural death.