Romania top court strikes down Swiss franc 'mortgage' loan

AP News
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Posted: Feb 07, 2017 2:23 PM

BUCHAREST, Romania (AP) — Romania's constitutional court has struck down a bill to help holders of mortgages that were taken out is Swiss francs by converting them into Romanian currency at the rate at which they were borrowed.

Court chairman Valer Dorneanu said Tuesday that one reason for the rejection was the significant differences between the bill approved by the Senate and the final version approved by the lower house.

In the mid-2000s, thousands of Romanians took out low interest rate loans denominated in Swiss francs. When the Swiss franc increased in value, they found it hard to repay the loans.

Lawmakers approved the bill in October. The central bank has opposed the measure, which it says will cost local banks about 2.4 billion lei ($570 million).