Poland is pressing its banks to provide relief for homeowners faced with soaring repayments on mortgage loans denominated in Swiss francs. As Haylay Platt reports it's not the only country trying to deal with victims of the lifting of the euro currency cap.
It's almost a week since Switzerland lifted its currency cap against the euro but the fallout continues to spread. Many central and eastern European countries sold housing loans in Swiss francs. How they help those mortgage holders now is high on their agenda. 60,000 housing loans in Croatia were made in the Swissie. And the finance minister there knows he has a problem (SOUNDBITE) (Croatian) CROATIAN FINANCE MINISTER, BORIS LALOVAC, SAYING: "You have seen how many citizens with loans in Swiss francs there are, some are contemplating suicide. God forbid something like that should happen, and if it did, then everyone would ask why we hadn't reacted sooner." Croatia has fixed the exchange rate for mortgage payments for a year. But a longer term solution is needed. Some blame the lenders. Zdeslav Santic is Chief Economist at Splitska Bank (SOUNDBITE) (Croatian) CHIEF ECONOMIST AT SPLITSKA BANK, ZDESLAV SANTIC, SAYING: "After the first bank had introduced such loans to the Croatian market, there was huge interest from clients, so other banks had to follow suit, because, lower interest rates made them more attractive so many ignored the warnings." Half a million Poles have Swiss franc mortgages - in the early 2000s they offered interest rates far below the domestic one. With borrowers facing a huge jump in repayments now the Polish government is under pressure. Its ordered an investigation into lending practices and is talking about making banks apply below-zero interest rates. But can they afford it? BGC's Mike Ingram. SOUNDBITE: Michael Ingram, market analyst, saying (English): "Polish banks are pretty well capitalised and I think Poland was the only country within Europe that didn't slip into recession in 2009 so I think the economy is relatively robust, the banking system is relatively robust." Many are now calling for a ban on loans in foreign currencies. But that won't be easy - particularly in Croatia where the majority of people hold their savings in foreign currencies.