Foreign Currency Loans Embed an Exchange Rate Risk: The Case of SWISS FRANC Loans
Loans and mortgages in SWISS FRANC became popular in Cyprus after 2006, the year when the Republic was a candidate country to assess the EURO zone. During this particular period, SWISS FRANC loans were attractive because the cost of borrowing was relatively low. Notably, within the period 2006-2009, thousands of investors took loans in SWISS FRANC. Nevertheless, the sudden appreciation of...