Danske Bank Says Extreme Negative Rates Changing How We Think

The mortgage unit of Denmark’s biggest bank says there’s a risk customers are becoming “blind” to the possibility that interest rates will ever return to normal levels after four years of life below zero.

Realkredit Danmark, the home-finance arm of Danske Bank A/S, is raising fees in an effort to prevent more customers from taking on adjustable-rate loans that require frequent refinancing. A shift toward fixed-rate mortgages that had begun in 2010 has started to reverse, threatening to undermine Danske’s efforts to reduce refinancing risks.