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Until financial crisis in 2008 banks were offering loans, mortgages or credits with acceptable interest rates and terms. Some banks were encouraging citizens to borrow money in Swiss currency, mostly offering Swiss Franc with lower interest rates, around 2% Until financial crisis 1 CHF=4.9 HRK but during financial crisis in 2011, Swiss Franc rose to 1 CHF=7,1 HRK
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RISE OF THE SWISS FRANC –
MORTGAGE PROBLEMS IN
CROATIA
Anja IšekMA1N0206
INTRODUCTION In Croatian financial market 32 banks
are present Main banks are mostly own by the
foreign banks such as:Unicredito (Italy)
Societe Generale (France)
Hypo (Germany)
Erste (Germany)
RBA (Austria)
Almost every second citizen of Croatia has mortgage or loan which were widely acceptable way of investing in their future until 2008
Until financial crisis in 2008 banks were offering loans, mortgages or credits with acceptable interest rates and terms.
Some banks were encouraging citizens to borrow money in Swiss currency, mostly offering Swiss Franc with lower interest rates, around 2% Until financial
crisis 1 CHF=4.9 HRK but during financial crisis in 2011, Swiss Franc rose to 1 CHF=7,1 HRK
At the time, more then 100 000 mortgages or loans were issued in Swiss Franc
Many citizens were in deep problems, unable to pay monthly home mortgage payments and insurance payments, they increased national debt in Swiss currency
Some citizens lost their houses, apartments or they lost their business, bankrupt
In 2012 some of the users of Swiss franc mortgages and loans together with Consumer Association of Croatia sued 8 Croatian banks for their wrong computing of interest rates
In 2013 Trade Court of Croatia claimed these banks GULTY for their wrong computing of interest rates causing collective damage for Croatian users of mortgages
Still the decision is not FINAL and banks have the right to APEAL, so the case is still in process
In 2012 SNB (Swiss National Bank) proclaim a measure which will prevent further appreciation of a Swiss Franc
Furthermore, rate of the Swiss Franc should be fixed by the rate of 1 CHF=6 HRK
At the moment 1 CHF=6.2 HRK and Croatian citizens are still waiting for the final decision of the Croatian Trade Court
This case is unique case in Croatian Judiciary System and therfore unique in Europe
So far is the only case where interest of the citizens beat the interest of the bank
THANK YOU FOR YOUR ATTENTION
