WIBOR – What Is It and How Does It Work? The CJEU Ruling on WIBOR
On 12 February 2026, the Court of Justice of the European Union (CJEU) issued an important judgment concerning the use of WIBOR in loan agreements concluded by banks. We considered this a good opportunity to explain what WIBOR is and how it works, as many borrowers still do not fully understand this reference rate.
Meanwhile, almost every mortgage agreement in Poland contains a clause stating that the interest rate is calculated using the formula: WIBOR + bank margin.
It is therefore worth understanding what WIBOR is, how it is determined, and what the CJEU ruling on WIBOR means for borrowers.
In this article you will learn:
• What is WIBOR and what types of WIBOR exist?
• How is the WIBOR rate calculated?
• What potential issues are associated with WIBOR?
• What does the CJEU ruling on WIBOR mean for borrowers?
What is WIBOR?
From a borrower’s perspective, WIBOR is the second key component of a loan’s interest rate, alongside the bank’s margin. WIBOR appears in around 99% of mortgage agreements in Poland.
Whether your loan has a variable interest rate or a temporary-fixed rate, the interest rate, and therefore the monthly instalment and the total cost of the loan, ultimately depends on WIBOR. That is why, if you already have a mortgage or are considering taking one out, you should understand this reference rate.
So, what is WIBOR in a broader sense?
WIBOR (Warsaw Interbank Offered Rate) is the interest rate at which banks lend money to one another. These loans can have different maturities, which is why several WIBOR rates exist.
The mechanism works similarly to bank deposits. When you open a deposit, you effectively lend money to a bank, and the bank pays you interest. The interest rate depends on market conditions, outlook on the future, and the length of the deposit. The same logic applies to WIBOR.
For example, on 12 February 2026, banks were willing to lend to each other at the following WIBOR rates:
| WIBOR rate | Loan period | Annual rate |
|---|---|---|
| WIBOR ON | 1 day | 4.05% |
| WIBOR SW | 1 week | 4.04% |
| WIBOR 1M | 1 month | 4.00% |
| WIBOR 3M | 3 months | 3.87% |
| WIBOR 6M | 6 months | 3.76% |
| WIBOR 1Y | 1 year | 3.68% |
Why do banks lend money to each other?
At first glance, it may seem that banks always have enough money – we all keep our money with them after all. In reality, the banking system is a complex mechanism. Every day, banks:
- accept customer deposits,
- process withdrawals,
- grant loans,
- settle transactions with other banks.
As a result, one bank may temporarily have excess cash, while another may experience a shortfall. Instead of holding large cash buffers, banks lend money to each other. There are also regulatory reasons for this, but we will not go into those details here.
How Is WIBOR Calculated?
WIBOR is set directly by banks and indirectly by Polish Central Bank – NBP. Let’s look at these two factors separately.
The Role of Banks
Not all banks participate in setting WIBOR—only selected institutions. The current participants can be found on the website of the WIBOR administrator, GPW Benchmark:
Each day, participating banks declare the interest rate at which they are willing to lend to other banks. Extreme values are rejected, and average rates are then calculated and published for each WIBOR maturity.
The Role of NBP
Banks do not set WIBOR in a vacuum. Their decisions are strongly influenced by the NBP’s monetary policy.
The NBP sets its own interest rates for transactions with banks:
- Deposit rate – which sets the lower bound for WIBOR, as banks will not lend money at a lower rate than they can earn by depositing funds with the NBP.
- Lombard rate – sets the upper bound for WIBOR, as banks will not borrow at a higher rate than they can obtain directly from the NBP.
- Reference rate – which always lies exactly between the deposit and lombard rates.
As of 17 February 2026, NBP rates were:
| NBP rate | Level |
|---|---|
| Lombard rate | 4.50% |
| Reference rate | 4.00% |
| Deposit rate | 3.50% |
To summarize, the NBP defines the corridor within which WIBOR can move, and banks decide where exactly within that range the rate will be set.
How was WIBOR changing throughout the years? Below grapth shows WIBOR values on the dates when NBP was changing its interest rates:
WIBOR fluctuates over time—sometimes sharply, as seen in 2021–2022, when Poland experienced high inflation. This is a crucial point for borrowers. When WIBOR rises or falls, monthly mortgage instalments change accordingly. This applies both to variable-rate loans and to loans with temporarily fixed rates (after the fixed-rate term ends). As a borrower, it is wise to check what would happen to your instalment if WIBOR increased by 1, 2, or even 5 percentage points.
Concerns about WIBOR
Although WIBOR is based on bank-to-banklending, in practice Polish banks rarely need to borrow from one another at WIBOR rates. Much more often it is us, bank clients, who lend banks our money, and at a much lower rate than WIBOR. This is why the banking sector in Poland has been structurally over-supplied with cash for years.
By the end of 2025, Polish households held almost PLN 1.3 billion in current accounts and deposits—often bearing interest below WIBOR or no interest at all. These funds more than cover banks’ liquidity needs.
This has two important consequences:
- Banks earn more than just the margin stated in loan agreements. They also benefit from the difference between WIBOR and their actual cost of funding.
- A potential conflict of interest arises, as banks that help determine WIBOR also offer loans linked to that rate. When banks are lending at WIBOR and not borrowing at this rate – the higher the WIBOR the higher banks gains. This is raising concerns among borrowers and regulators.
As a result, work is underway on a new reference rate, POLSTR, which is intended to replace WIBOR and be based exclusively on actual bank-to-bank transactions and not their declarations.
What Is the CJEU Ruling on WIBOR About?
The CJEU ruling of 12 February 2026 is one of the most important mortgage-related judgments for Poland in recent years.
After disputes over Swiss-franc loans, borrowers increasingly began challenging PLN-denominated loans with variable interest rates based on WIBOR. Lawyers argued that banks failed to properly inform consumers about interest-rate risk and the mechanics of WIBOR.
The case originated from proceedings before a Polish regional court, which asked the CJEU whether:
- WIBOR-based interest clauses can be reviewed for unfairness,
- whether banks must explain the methodology behind WIBOR in detail,
- if insufficient information could lead to loan invalidity or removal of WIBOR from the interest rate.
What Did the CJEU Decide?
The CJEU ruled that:
- WIBOR-based clauses may be subject to judicial review,
- WIBOR itself is not inherently unfair,
- banks are not required to provide technical details of WIBOR’s methodology if the benchmark is lawful, regulated, and widely used,
- transparency and proper risk disclosure are the key factors.
Importantly, the ruling excluded automatic invalidation of WIBOR-based loan agreements.
What Does the CJEU Ruling Mean for Borrowers?
The judgment means there are no grounds for mass invalidation of mortgages based on WIBOR. Any disputes will be assessed individually, mainly with regard to whether the bank fulfilled its information obligations.
Summary
What do we think about all this? On the one hand, overturning WIBOR could have caused serious disruption in the Polish banking system and the wider economy. On the other hand, some of the criticism raised against WIBOR is not entirely unfounded.
For now, however, WIBOR remains the key reference rate for mortgages in Poland. Understanding what WIBOR is, how it is set, and what risks it entails allows borrowers to manage their finances more effectively and make informed credit decisions.