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Mortgage Pfandbrief

Assets which are eligible as cover for Mortgage Pfandbriefe are loans secured by real estate lien in the member states of the European Union, in Contracting States to the Agreement on the European Economic Area (EEA), in Switzerland, the USA, Canada and Japan.

However, loans may serve as cover only up to 60% of the mortgage lending value. In addition to real estate loans, a maximum of 20% of the aggregate volume of Mortgage Pfandbriefe outstanding may take the form of other cover assets. These may be claims under bonds of or guaranteed by central governments and sub-sovereign public-sector bodies (see also “Public Pfandbriefe”) or money claims against suitable credit institutions. The latter may be included up to 10% of the aggregate volume of Mortgage Pfandbriefe outstanding.

And finally, claims under derivative transactions concluded with suitable credit institutions may also be included in the cover pool up to a maximum of 12 % based on their net present value.

Statutory basis

Provisions governing the eligibility of claims as cover for Mortgage Pfandbriefe in particular are set forth in §§ 12 – 19 Pfandbrief Act.

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