| Autor: Edward Wiszniowski | 195 |
Strony: 195-209
pełen tekst
LTV RATIO VERSUS THE CARRYING AMOUNT OF CREDIT EXPOSURES SECURED BY MORTGAGES
Summary
This article is devoted to the proper interpretation of the “value of credit exposure secured by mortgages”, included in the S (II) Recommendation of Financial Supervision Commission and to the demonstration of the differences in the ways of calculating the LtV ratio for individual credit exposure and the bank’s loan portfolio. Conducted analysis and research carried out in the form of examples have shown that the value of credit exposures secured by mortgages is not useful in the study LtV ratio. What is useful, however, is the value of the borrower’s debt as of the balance sheet date. LtV ratio for the bank’s loan portfolio should not be calculated as the total ratio of borrowers’ debt and the total market value of real estate hedge of credit exposures, but as the borrowers’ total LtV, weighed as their debts in the loan portfolio.
pełen tekstLTV RATIO VERSUS THE CARRYING AMOUNT OF CREDIT EXPOSURES SECURED BY MORTGAGES
Summary
This article is devoted to the proper interpretation of the “value of credit exposure secured by mortgages”, included in the S (II) Recommendation of Financial Supervision Commission and to the demonstration of the differences in the ways of calculating the LtV ratio for individual credit exposure and the bank’s loan portfolio. Conducted analysis and research carried out in the form of examples have shown that the value of credit exposures secured by mortgages is not useful in the study LtV ratio. What is useful, however, is the value of the borrower’s debt as of the balance sheet date. LtV ratio for the bank’s loan portfolio should not be calculated as the total ratio of borrowers’ debt and the total market value of real estate hedge of credit exposures, but as the borrowers’ total LtV, weighed as their debts in the loan portfolio.