Conversion of CHF denominated mortgages becomes Romania's key electoral debate

In January 2016, the Swiss National Bank abandoned its peg against the euro which saw marked appreciation of CHF exchange rate after European Central Bank introduced a massive stimulus program.

Huge housing mortgages in Swiss Francs have seen double-digit appreciation causing immense hardships to debtors who have been struggling to repay debt after Swiss Franc / Romanian Leu exchange rate soared to a record-high of over 4.5 RON.

As Romania goes to the polls in December, the issue has become a key electoral debate. The Social Democratic Party (PSD) and the National Liberal Party (PNL) support the conversion of mortgages.

Romania is considering converting mortgages taken out in Swiss Francs into the local currency (RON), at the exchange rate applicable when they were issued. Hungary and Poland have seen a standoff with credit rating agencies over its decision to impose mortgage conversions into the local currency (Zloty) at the exchange rate of when they were issued.