EUROPEAN EXPERIENCE OF THE MORTGAGE MARKET

The article deals with European practice in the mortgage market. European mortgage markets are structurally very different for many reasons. Levels of mortgage indebtedness are very different, too, ranging from 50% of GDP in Denmark to just 10% in Greece. The main methods of financing mortgage loans are deposits and mortgage bonds. Mortgage bonds are residential mortgage-backed securities (RMBS) and mortgage covered bonds. Mortgage covered bonds are a type of cover bonds. European Covered Bond Council defines the basic characteristics of the above bonds: covered bonds are bonds issued by credit institutions which are secured by a protected pool of high-quality assets; they grant the holder privileged claims on the pool of cover assets upon default of the issuer. Scientific research is focusing on construction of mortgage cover bonds emission models: covered bond issuer is a completely specialized funding institute; the issuer is a legal specialized credit institution; a covered bond issuer is a universal credit institution; the issuer assets; Covered Bond is a result of pooling models.