The bank margin fell for the third quarter in a row. At 213 bps, the average margin for new five-year loans with 65 per cent LTV is nine bps lower than in the fourth quarter. Margins have now declined by 35 bps since last May, but are still 10 bps higher than a year ago.

Interest rates with a long tenor are climbing at full speed. The five-year swap rate up by 42 bps from the fourth quarter. As a result, overall financing costs for new five-year loans with full interest-rate hedging have risen by 33 bps to 3.40 per cent.

The five-year rate has risen by 83 bps from the second quarter of 2020, but the decline in the bank margin is moderating the rise in borrowing costs, which are thereby still substantially lower than a year ago.

Assuming a floating rate, borrowing costs remain at a record-low level of around 2.60 per cent