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FMA Survey on Foreign Currency Loans in the 4th Quarter of 2019: outstanding volume has fallen by three quarters since its peak in 2008

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The outstanding volume of foreign currency loans (FX lending) to private households fell by € 1.90 billion or -12.8% adjusted for exchange rate effects in 2019. During the 4th Quarter alone, the amount fell by € 500 million or -3.6% compared to the preceding quarter. 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 € 34.88 billion or -74.60% adjusted for exchange rate effects. In absolute figures there are foreign currency loans to private households outstanding with a current value of € 13.25 billion; in 2006, at its highest level, this amount stood at € 38.8 billion. This is the finding of the FMA’s survey on foreign currency loans in the fourth quarter of 2019.

Consistent reduction of risks – for banks as well as private households

“We are limiting the risk from foreign currency loans and loans with repayment vehicles in a consistent, successful and sustainable manner. Compared with the height of the foreign currency loan boom, taking into account exchange rate effects approximately three quarters of the outstanding volume has been reduced, or almost two-thirds in absolute terms. Today, foreign currency loans neither pose risks for Austria’s financial market stability, nor for individual institutions. Banks have already made provision accordingly for the remaining risks,” remark the FMA’s Executive Directors, Helmut Ettl and Eduard Müller: “We must and will continue this consistent path, in order to further limit the risk for borrowers, especially by continuing to close the funding gaps that continue to exist in outstanding foreign currency loans with repayment vehicles as far as possible in the coming years.”

The proportion of foreign currency loans of outstanding loans to private households were reduced by 1.3 percentage points to 8.3% in 2019. Compared with the height of the foreign currency loan boom, where this share stood at 31.8%, it has fallen from approximately one-third to significantly below one-tenth. As of year-end 2019, 96.1% 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 (CHF) appreciated by 52.2% up until 31 December 2019 against the Euro; in the fourth quarter of 2019, the exchange rate varied between 1.0854 and 1.1047, 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)676/882 49 516

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