PKO Bank Polski to offer first mortgages based on POLSTR index

PKO Bank Polski and PKO Bank Hipoteczny have announced they will be the first to offer new mortgage loans based on the POLSTR (Polish Short Term Rate) index, starting September 3. This move marks a significant step in the ongoing reform of interest rate reference indices in the Polish financial market.

The transition involves replacing the widely used WIBOR (Warsaw Interbank Offered Rate) with POLSTR. While WIBOR is being phased out through an orderly liquidation process scheduled to conclude by December 31, 2036, a roadmap established by the National Working Group on Reference Rate Reform dictates that banks should no longer issue new contracts based on WIBOR starting January 1, 2027.

Unlike WIBOR, which incorporates both real transactions and model-based quotes, POLSTR is designed to be based exclusively on real transactions in the interbank market. The Polish Financial Supervision Authority recently recognized POLSTR as a significant reference index, with its total application scale in the Polish market exceeding 18.5 billion euros.