The outstanding volume of foreign currency (FX) loans extended to households declined by 63.4% or € 22.9 billion (exchange rate adjusted) by the end of the second quarter of 2015, after the ban on new FX lending was introduced in the autumn of 2008. In a quarter-on-quarter comparison the volume declined by 15.7% or € 4.1 billion in Q2 2015, while it fell by 2.8% or € 740 million when compared with the previous quarter (all figures exchange rate adjusted). This was disclosed in the FMA’s Survey on Changes in Foreign Currency Loans in Q2 2015.
“Since three out of four foreign currency loans are not amortising but bullet loans and the repayment vehicles currently show an average shortfall in cover of 24%, we must consistently press ahead in our joint efforts to limit the risk,” FMA Executive Directors Helmut Ettl and Klaus Kumpfmüller stated. Over 80 per cent of foreign currency loans had a residual maturity of more than five years. However, redemption rates would peak for the first time in 2020, so it was paramount not to slacken efforts, they noted. Efforts undertaken since 2008 had resulted in exchange rate risk being eliminated in 140 000 foreign currency loans, through conversion into euro-denominated loans or through other hedging techniques. “We succeeded in ensuring that more than 140 000 Austrian households can rest easy,” the FMA Executive Directors commented. However, some 138 000 Austrian households still have a foreign currency loan outstanding, with amounts to be redeemed averaging just over € 180 000.
In absolute terms, private households still owed foreign currency loans amounting to a total of € 26.1 billion as at 30 June 2015. This is due in particular to the fact that the Swiss franc has appreciated against the euro by 58.9% since early 2008; since the ban on new FX lending introduced on 10 October 2008 the CHF has appreciated by 45.7% or, expressed differently: whoever took out a CHF loan of € 100 000 in early 2008 today would have to redeem the loan – without interest – at € 158 900 solely because of currency appreciation.
The share of foreign currency loans in relation to all outstanding household loans in Austria dropped by one percentage point to 18.7% within one year (from Q2 2014 to Q2 2015). At the height of the foreign currency boom in mid-2006 the share was still 31.8%. Due to the measures taken by the FMA this share has meanwhile fallen from more than one third to markedly less than one fifth.
After the Swiss National Bank had lifted its exchange rate pegging of 1.20 to the euro on 15 January 2015, the Swiss franc appreciated further and fluctuated between 1.025 and 1.055 in the second quarter.
Journalists may address further enquiries to:
Klaus Grubelnik (FMA Media Spokesperson)
+43/(0)1/24959-6006
+43/(0)676/882 49 516