Finnish Financial Supervisory Authority raises housing loan cap for non-first-home loans to 95%, keeps CCyB at 0% and O-SII buffers unchanged

The Finnish Financial Supervisory Authority’s board has decided to raise the maximum loan-to-collateral ratio for housing loans other than first-home loans to 95%, using new powers introduced at the beginning of June 2026 to ease conditions in a housing market it still considers to be in a downturn. The cap for first-home loans remains at 95%. In the same macroprudential decision, the board kept the countercyclical capital buffer requirement for banks at 0.0% and left additional buffer requirements for other systemically important institutions unchanged. The authority linked the easing of the housing loan cap to a weaker economic and housing market outlook amid geopolitical tensions and the effects of the Middle East conflict on energy prices, inflation and uncertainty. It said indicators of financial cycle overheating remain limited, with the private sector credit-to-GDP gap falling in the first quarter of 2026 to the lowest level seen in the cycle. While corporate lending has grown briskly early in the year, household loan growth has remained more subdued. The annual review of O-SII buffers found no material change in the systemic importance of Finnish O-SIIs, so the existing rates remain in place at 2.5% for Nordea Bank Abp, 1.5% for OP Pohjola and 0.5% for Municipality Finance Plc. The board said it will assess on a quarterly basis whether conditions still support the temporary easing of the maximum loan-to-collateral ratio. It also continues to decide quarterly on the CCyB rate, while O-SII buffer levels are reviewed at least annually.