AMSTERDAM (Reuters) - The Dutch central bank said on Tuesday it would require banks to retain 3 billion euros (.31 billion) in additional capital to compensate for risks posed by mortgage portfolios.
In its fall report on financial stability, De Nederlandsche Bank said the measure would better prepare the banks to weather a downturn in house prices. It said it would increase the average risk weighting for mortgages to 14%-15% from the current 11%
In the report, the bank also warned that continuing low interest rates pose a challenge to stability, as they undermine banks' profitability and hurt solvency at pension funds and insurance companies.
