SPÖ-Kucher/Hergovich on bank excess profits: “Skip off excess profits and thus reduce exploded interest rates on home builder loans!” – 2024-04-14 19:02:19

After record profits in 2022, banks increased their profits in 2023 by a third to 14.1 billion euros; Excess profits at the expense of savers and home builders

Vienna (OTS/SK) – Austria is confronted with market failure in many areas. Due to the inaction of the black-green federal government, record inflation has an incredible number of losers and only a few winners. The banks are among the big winners of the crisis in Austria. Due to the ECB’s increased key interest rate, many banks have multiplied their interest income from this area on variable loans in recent months. While banks immediately increased the interest rates on loans extremely, they hardly adjusted the interest rates for savers. This creates a so-called interest surplus, which has now gotten completely out of control. These excess profits arise at the expense of borrowers on the one hand and savers on the other. ****

As of yesterday, it is clear how high the banks’ excess profits are. After the record profit year of 2022 (at that time, the banking sector’s profits were already 11.2 billion euros), the banks increased their profits by a further 38 percent to 14.1 billion euros.

The SPÖ wants to intervene and return the banks’ excess profits to the bank customers. An interest price cap should be implemented for borrowers and a minimum interest rate should be set for savers. SPÖ club chairman Philip Kucher and SPÖ Lower Austria boss Sven Hergovich demand: “We want to skim off the banks’ excess profits and give them back to the bank customers. Let’s reduce the skyrocketing interest rates on home builder loans and guarantee minimum interest rates on savings accounts!”

To put it in perspective: When the market fails, you intervene instead of watching. From Great Britain, via France and Germany: Either competition works, or governments politically put a stop to market failure. In Great Britain, for example, the government threatens banks with British regulators if interest rates are too high; in France there are minimum interest rates on savings accounts. In Germany, on the other hand, there are significantly higher interest rates on savings accounts than in Austria, for example, because competition works. Kucher: “In Austria there is neither a functioning competition nor a government that conducts politics and intervenes as a profession.” Hergovich adds: “The government’s inaction leads to record profits for the banks at the expense of all savers and all borrowers. This money is currently being spent on absurd board salaries such as the 10 million euros for the BAWAG board or similar nonsense. It would make much more sense to return part of these profits to customers with a moderate interest rate cap.” The upcoming National Council election is about a directional decision. We know that a black-blue government, like the one ÖVP and FPÖ are striving for, is always on the side of the corporations and banks when in doubt. “The SPÖ is on the side of home builders and savers, not on the side of the banks,” they conclude. (End) lk/pok

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