The Austrian Financial Market Authority FMA today published Minimum Standards for Informing Building Society Savers and for Building Society Advertising (FMA-MS-BSPK). The standards are structured in two sections: Informing Prospective Parties to a Building Savings Contract, and Informing Existing Building Society Savers. One aim in publishing the FMA-MS-BSPK is to ensure transparent presentation of the various premium plans and fees involved in building society contracts, so as to make contract offers more readily comparable for prospective savers. Another purpose of the standards is to define the items of information required to be provided to existing building society savers at least once a year. Compliance with the FMA-MS-BSPK is required for the most part from 30 April 2012.
“Transparent presentation of the premium plans and fees involved in building society contracts is an intrinsic factor in enabling consumers to compare different products,” FMA Executive Director Helmut Ettl pointed out. Executive Board colleague Kurt Pribil added: “By issuing these Minimum Standards, the FMA is taking a further step in its initiative for enhanced transparency.”
Before signing a building society savings contract, interested consumers are to receive a meaningful overview of the current savings plans and the differences amongst them as well as of interest rates and fees. Building societies are additionally required to disclose to prospective customers the consequences of terminating the contract prematurely. With regard to building society advertising, the FMA has ruled that such advertising must be provided in a manner that is clear, understandable and not misleading for the consumer with an average level of information. When amending their general terms of business for savings contracts, building societies must ensure that advertising materials are adapted immediately.
Individuals with existing building savings contracts are to be sent an account statement at least once a year. The statement must include items such as the initial balance, the amount of payments made to the account and of any withdrawals, the amount of the bonus provided by the state, the current balance, the contract amount and the contact information of the building society and of the building saver. The FMA also recommends that building societies notify building society savers, in a timely manner prior to the expiry of the minimum savings contract term, of the necessary steps for having the savings account balance paid out or for receiving a loan.
About 5.6 million people in Austria currently have a building society contract (about 5.2 million savings contracts and around 366,000 loan agreements). Building savings deposits are classified as deposits subject to guarantee obligations as defined in Article 93 para. 2 of the Bankwesengesetz (BWG; Austrian Banking Act), and are thus a safe, low-risk form of investment. The four building societies licensed in Austria concluded a total of almost one million new contracts during each of the years 2009 and 2010, with about 980,000 new contracts in the 2011 financial year.
The FMA-MS-BSPK may be viewed (in German) on the FMA website at https://www.fma.gv.at/fma/fma-mindeststandards/
Journalists may address further enquiries to:
Klaus Grubelnik (FMA Media Spokesperson)
+43/(0)1/24959-5106
+43/(0)676/882 49 516