Realkredit Danmark, the lender that is part of the Danske Bank group, has for the first time ever paid out on a loan taken out by a customer rather than the other (normal) way round, as a result of the country's ongoing negative interest rate environment.
As reported in local financial publication Børsen, the payment to the customer came at the end of the loan term, and was paid out at the end of July following final calculations on who owed what to whom.
Christian Hilligsøe Heinig, chief economist, noted to Børsen that there are additional loans in the pipeline that could potentially also result in payouts from the lender.
The impact of negative rates is not expected to affect traditional fixed rate or other types of mortgage loans more broadly, but so far concerns products where rates are set more frequendly and the payments may come more towards the end of the term.
However, given that discussions around mortgage rates are considered the equivalent of a national sport in Denmark, borrowers are keeping an eagle eye on exactly what the lenders are offering, particularly in light of whether or not any payments back to the customer are done in cash or not.
There are also differences between lenders' costs, depending on the duration and type of loan, which may affect whether or not the negative rates are passed on in the form of a gain to the customer at the end of the term.
Danmarks Nationalbank, the central bank, currenly pays -0.65% on certificates of deposit and 0% on current accounts. Its discount rate is 0% and its lending rate is 0.05%.
It has been widely reported that Jyske Bank has moved to offer a 10-year deal at -0.5%, while Nordea looks set to offer a 20-year deal fixed at 0%, and 30-year deal at 0.5%. Payments need to be made on the principle.