The Mortgage Society of Finland

Very strong risk-adjusted capital (RAC). Strong asset quality and exceptional loan-loss track record in recent decades. Very conservative lending and underwriting standards. Monoline business model as a pure residential mortgage financer. Concentration and cyclical risk due to focus on residential mortgage lending. Predominantly wholesale funding profile. The outlook on The Mortgage Society of Finland (Hypo) is stable and reflects our view that sound construction activity in Finland, on the back of a benign economic environment, will help Hypo to pursue its loan growth without diluting its asset quality. It also reflects our view that material changes to the bank's capital management are unlikely over our outlook horizon. We could lower the ratings on Hypo in the next 18-24 months if:

...The outlook on The Mortgage Society of Finland (Hypo) is stable and reflects our view that sound construction activity in Finland, on the back of a benign economic environment, will help Hypo to pursue its loan growth without diluting its asset quality. It also reflects our view that material changes to the bank's capital management are unlikely over our outlook horizon....

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