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Bausparkassen

Article from the Annual Report 2016 of the BaFin

The low interest rates are also having a major negative impact on the earnings situation of the Bausparkassen. One reason is that there is no corresponding interest income from Bauspar loans to offset the interest expenses on Bauspar deposits paying a comparatively high rate of interest. However, an amended Bausparkassen Act (Bausparkassengesetz) came into effect at the end of 2015. It helps the Bausparkassen to lessen the consequences of low interest rates for the long term.

In 2016, the Bausparkassen continued their attempts to deal with the consequences of the low interest rate environment. As in previous years, they introduced new lower-interest tariffs, created leaner processes and reduced their costs.

In addition, the Bausparkassen are also continuing their efforts to reduce the proportion of high-interest Bauspar contracts in their portfolio. This was made clear by the many terminations again announced by Bausparkassen in 2016, relating to Bauspar contracts that are over-saved or have been eligible for allocation for more than 10 years. The prevailing opinion of the courts is that the termination of over-saved building savings contracts is permissible.

On 21 February 2017, the Federal Court of Justice (BundesgerichtshofBGH) ruled in principle that Bausparkassen may terminate Bauspar contracts that have been eligible for allocation for at least 10 years without the savers having taken out the allocated loan. Allowing a Bauspar contract to run for more than 10 years simply as a savings account was in conflict with the meaning and purpose of Bauspar plans, according to the Court's decision.

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