The Mortgage Lending Value: Benefit or Burden for Pfandbrief Banks?

Rudolf Baumgartner, M-Wert GmbH, ein Unternehmen der M√ľnchener Hypothekenbank eG

The mortgage lending value is an important pillar of the safety of Mortgage Pfandbriefe, helping make it possible for these securities to be issued at any time, even during sustained periods of crisis.At the same time, however, the mortgage lending value is sometimes viewed as being out of step with the market and too expensive to determine. But this concept, which has been around for more than 100 years, levels out exaggerations in the property markets by taking into consideration the long-term nature of the property loan, with a focus on sustainability. This benefits everyone.

The crisis in the capital markets has not yet been surmounted, but German Pfandbrief Banks have seen lending volumes rise for two consecutive years. New business in Germany is grow-ing for both private and commercial property loans, meaning that the future can once again be viewed with greater confidence. This confidence is spurred in particular by the high degree of stability that the German property market showed during the years of the crisis and that it continues to show.