Nykredit Lifts IO Cap on Mortgages Amid Effort to Woo BanksFrances Schwartzkopff
Nykredit Realkredit subsidiary Totalkredit will fund interest-only loans originated by Sydbank to maximum amount allowed by law, reversing earlier decision, Sydbank says in statement. * Nykredit will finance IO loans up to 80% of property’s values, the legal limit; mortgage bank had previously capped IO loans at 60%, with Sydbank funding remaining amount * Change will improve Sydbank’s competitiveness, Jan Svarre, bank director, says in statement * Nykredit makes same agreement with members of Denmark’s Association of Local Banks; Nykredit CEO Michael Rasmussen says in statement change part of effort to tighten relations with local lenders * Cap no longer necessary because of housing market recovery, Totalkredit director Troels Bulow-Olsen says in statement * NOTE: Nykredit had capped IO funding at 60% for retail mortgages in 2012 to cut supplementary collateral requirements in event property prices declined * NOTE: Nykredit said in Feb. it would “reinvigorate” ties with banks doing business with Totalkredit
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