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Czech building societies` lending 11 pct lower in 2009
News » Czech building societies` lending 11 pct lower in 2009
Prague, Jan 21 (CTK) – Czech building societies provided Kc66.4bn worth of loans last year, which is a year-on-year decrease of over 11 percent, according to the building societies` results which CTK has at its disposal. Interest in new home-building savings contracts also weakened last year.
Full-year results are no surprise given the monthly data, said Jiri Sedivy, secretary of the Czech Building Societies Association (ACSS). „We consider the 11-percent drop in loans against a very successful year 2008 a partial success of home-building savings in difficult conditions of the economic recession,“ said Sedivy. Other types of housing loans have been hit by the crisis to a greater extent, according to him.
For this year, ACSS expects similar results as last year both in terms of loans and signed contracts. „Demand for home-building savings is not expected to change much also due to the fact that the Czech housing fund still lacks around Kc500bn to reach a quality housing standard, according to available data,“ said Sedivy. Building societies signed around 887,000 new home-building contracts, a fall from over million contracts in 2008. „The range of possibilities for many citizens to save part of their income have diminished as a result of which the number of signed contracts decreased year-on-year,“ said Sedivy.
The target amount for new contracts went down by Kc40bn to over Kc271bn. Czechs have always liked home-building savings due to annual state subsidies. In recent years, however, they have increasingly used the product for investments into their homes.
| Volume of loans granted in 2009 building society | loans (in Kc mil.) | yr/yr change (in pct) | no. of contracts (in thousands) |
|---|---|---|---|
| TOTAL | 66,418 | –11.3 | 5,347 |
| Numbers in 2009 | new contracts 2009 | target amount 2009 (in Kc mil.) | new contracts 2008 | target amount 2008 (in Kc mil.) | no. of loans in 2009 | no. of loans in 2008 |
|---|---|---|---|---|---|---|
| TOTAL | 886,686 | 271,529 | 1,040,843 | 311,447 | 128,697 | 145,022 |
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The Association of Czech Building Societies in the Czech Republic (ACSS) comprises five building savings banks. It was founded on June 29, 2000, with the aim of supporting the joint interests of the building savings banks operating in the Czech Republic. It thus continued a long-term informal co-operation among the financial institutions.
You can get more information about the ACSS here.
NOT TO OMIT
ACSS advises: Home-building savings contracts signed in 2003 remain in full force and effect regardless of the expiration of the five-year saving phase. You can read more here.