Norwegian Financial Supervisory Authority recognises Sweden’s IRB risk-weight floors for commercial property exposures and declines reciprocity for Swedish mortgage and German housing measures

The Norwegian Financial Supervisory Authority has decided to apply voluntary reciprocity for Sweden’s macroprudential measure on lending secured by commercial real estate and commercial residential real estate in Sweden, meaning the requirements continue to apply to relevant Norwegian banks. It did not recognise Sweden’s mortgage measure or Germany’s housing-related measure because Norwegian banks’ exposures in those markets are below the applicable materiality thresholds. For Sweden’s commercial property measure, banks using the Internal Ratings-Based approach (IRB) must apply an average risk-weight floor of 35% for corporate exposures secured by commercial real estate and 25% for corporate exposures secured by commercial residential real estate. The decision keeps these floors applicable to Norwegian IRB banks, at both individual and group level, where relevant exposures in Sweden exceed the materiality threshold of SEK 5bn. Sweden’s mortgage measure sets a 25% average risk-weight floor for IRB mortgage portfolios with a SEK 5bn materiality threshold, and Germany’s measure applies a 1% sectoral systemic risk buffer to all exposures secured by residential property located in Germany where the collateral reduces capital requirements, with a EUR 10bn materiality threshold. The decisions apply from 18 December 2025. The authority will monitor Norwegian banks’ exposures and reassess if a materiality threshold is exceeded.