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Europe and Central Asia

The Housing Finance System

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A. Primary Housing Finance Market
B. Funding Sources for Mortgages and the Secondary Mortgage Market
C. Housing Microfinance

A. Primary Housing Finance Market

A.1 Industry Structure and Performance

Variable	End of 2018	End of 2017	End of 2016	Sources	Var ID
Number of firms originating and funding mortgage loans		267	274	Finance Finland	A.1.1
Types of originating lenders/market share:					A.1.2
Universal/ commercial banks	93.2% of total	93.8% of total	97.2% of total	Finance Finland	A.1.2.1
Other depository institutions (savings and loans/mutual savings and credit institutions)	4.7% of total	4.3% of total	2.8% of total	Finance Finland	A.1.2.2
Non-depository financial institutions specialized in housing finance	1.1% of total	1% of total	0% of total	Finance Finland	A.1.2.3
General non-depository financial institutions			0% of total	HypoStat	A.1.2.4
Others (e.g. insurance co, pension funds, labor tax funds)	1% of total		0% of total	Finance Finland	A.1.2.5
Identify the 3 largest loan originating lenders	OP financial group; Nordea; Danske Bank	OP Financial Group; Nordea Bank; Danske Bank	Nordea Bank, OP Group, Danske Bank	KTI	A.1.3
Are there (quasi) public mortgage lenders:	No	No	No	Hypostat	A.1.4
Universal/ commercial banks	No	No	No	Hypostat	A.1.4.1
Other depository institutions (savings and loans/mutual savings and credit institutions)	No	No	No	Hypostat	A.1.4.2
Non-depository financial institutions specialized in housing finance	No	No	No	Hypostat	A.1.4.3
General non-depository financial institutions	No	No	No	Hypostat	A.1.4.4
Others (e.g. insurance co, pension funds, labor tax funds)	No	No	No	Hypostat	A.1.4.5
Level of Non-Performing Mortgage Loans (90 days or more past due):					A.1.6
Average 1997-2007					A.1.7

A.2 Size of Mortgage Finance Sector

Variable	End of 2018	End of 2017	End of 2016	Sources	Var ID
Total amount of home mortgage loans outstanding at the end of year in millions of USD:	112,400 USD (millions)	114,424.01 USD (millions)	98,254.74 USD (millions)	Bank of Finland	A.2.1
Total amount of home mortgage loans outstanding at the end of year as % of GDP (current)	40.99%	45.18%	41.48%	Bank of Finland	A.2.1.1
and as % of all credits outstanding	47.94%	46.94%	41.63%	Bank of Finland	A.2.1.2
Total amount of home mortgages made in calendar year in millions of USD	39,971.76 USD (millions)	37,157.91 USD (millions)	30,675.56 USD (millions)	Bank of Finland	A.2.3
and as % of GDP (current)	14.58%	14.67%	12.95%	Bank of Finland, WEO	A.2.3.1
and as % of all credits originated in calender year			90%	European Commission	A.2.3.2

A.3 Housing Finance Products

Variable	End of 2018	End of 2017	End of 2016	Sources	Var ID
Mortgage products as % of all mortgages (approx.) in local currency:					A.3.1
Fixed rate for life of loan	2%	2.7%	2.7%	Hypostat	A.3.1.1
Variable rate/indexed	96.4%	94.8%	93.4%	Hypostat	A.3.1.2
Most prevalent type of foreign currency mortgage used:					A.3.3
Most frequent interest rates on fully amortizing:					A.3.4
Typical lender fees associated with mortgage origination:					A.3.6
Typical third party fees associated with mortgage origination:					A.3.7
Loan-to-Value (LTV) on first mortgage:					A.3.8
Maximum LTV	85	85	90	Finance Finland	A.3.8.1
Typical LTV at origination			90	European Commission	A.3.8.2
Maximum term over which pmt is calculated?	25 years	25 years	25 years	IMF	A.3.9
Mortgage pmt-to-income ratio					A.3.10
Maximum pmt-to-income ratio (Individual income)			40%	European Commission	A.3.10.2

A.4 Lending and Servicing Process

Variable	End of 2018	End of 2017	End of 2016	Sources	Var ID
Does the mortgage industry use standard principles/guidelines for underwriting?	Yes	Yes	Yes	Nordea Bank	A.4.1
Which institutions define underwriting rules?					A.4.2

A.5 Credit Risk Assessment

Variable	End of 2018	End of 2017	End of 2016	Sources	Var ID
Do credit bureaus exist?	Yes	Yes	Yes	European Credit Research Institute	A.5.2
Is mortgage default insurance available?	Yes	Yes	Yes	Genworth Financial Mortgage Insurance	A.5.3
When did it begin operating?	1961			Genworth	A.5.3.1
What is the typical MI product?	Borrower paid mortgage insurance, a payment option featuring a coverage term of one month with premiums paid monthly, which allows buyers to purchase the house with less down payment and provides financial protection in case of mortgage default	Borrower paid mortgage insurance, a payment option featuring a coverage term of one month with premiums paid monthly, which allows buyers to purchase the house with less down payment and provides financial protection in case of mortgage default	flow insurance (which provides insurance on a loan-by-loan basis every month) or insurance on a back book basis which protects a closed portfolio of loans.	Genworth	A.5.3.2
Are credit guarantee systems used?	Yes	Yes	Yes	Thomas Reuters	A.5.4

B. Funding Sources for Mortgages and the Secondary Mortgage Market

Variable	End of 2018	End of 2017	End of 2016	Sources	Var ID
What are the main funding sources for mortgages?					B.1
Retail funding (deposits/other)	primary	primary	primary	Nykredit Bank and Nordea Bank Finland	B.1.1
Funding through mortgage bonds	secondary	secondary	secondary	Nykredit Bank	B.1.3

C. Housing Microfinance

Variable	End of 2018	End of 2017	End of 2016	Sources	Var ID
Types of lenders operating in the housing micro-finance (HMF) sector:					C.2
Level of NPLs (>90 days past due) in HMF					C.4

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