The outstanding volume of foreign currency loans (FX-loan volume) to private households fell during the first quarter of 2017 by € 1.07 billion or 5.1% adjusted for exchange rate effects compared to the previous quarter, and by € 3.26 bn or 14.2% compared to the corresponding quarter of the previous year. Consequently, since the introduction of the ban on granting of new loans in the autumn of 2008 and the accompanying measures to limit risk, the outstanding volume of foreign currency loans (FX lending) to private households has fallen by EUR 28.66 billion or 62.2% adjusted for exchange rate effects. In absolute figures, there are still outstanding foreign currency loans to private households with a current value of € 20.03 billion; at its peak in 2011, this amount stood at € 38.8 billion. These were the findings of the FMA’s Survey on Foreign Currency Loans in Q1 2017.
“The fact that we once again tightened our Minimum Standards for Foreign Currency Loans and Loans with Repayment Vehicles at the end of April is a sign how important the orderly reduction of risk emanating from foreign currency loans to private households is for us”, remarked the FMA’s Executive Directors, Helmut Ettl and Klaus Kumpfmüller: “Where the residual maturity of the foreign currency loan is less than eight years, the bank is required to inform the borrower on at least an annual basis about the outstanding debt in Euro as well as where applicable the expected funding gap. Furthermore the bank must also offer appropriate measures to limit the risk.” After all, a considerable risk still remains that exchange rate fluctuations may make the repayment of the loan even more expensive.
The proportion of foreign currency loans to all outstanding loans to private households stood at 13.9% at the end of the first quarter of 2017, and has decreased by 2.3% over the course of the last four quarters. A sustainable reduction can be observed in comparison with the peak of the boom for foreign currency loans in mid-2006, where they accounted for 31.8% of all loans. The proportion of foreign currency loans fell from approximately one third to less than one seventh. At the end of the first quarter of 2017, 96.0% of the volume of the amount owed for loans in foreign currencies was for loans denominated in Swiss franc (CHF), with the remaining amount almost exclusively in Japanese yen (JPY).
Since the start of 2008, the Swiss franc appreciated by 54.7% up until 31.03.2017 against the euro; in the first quarter of 2017, the exchange rate varied between 1.0637 and 1.075, following the removal of the minimum exchange rate floor of 1.20 in January 2015.
Journalists may address further enquiries to:
Klaus Grubelnik (FMA Media Spokesperson)
+43/(0)1/24959-6006
+43/(0)676/882 49 516