The banks want to quickly solve what politicians promise: the interest on loans for the construction of homes will fall to 3.5 percent.
The demand for cheaper construction and housing financing has already been partially met. Erste Bank boss Willi Cernko, also spokesperson for the financial institutions: “We have already lowered our interest rate to 3.5 percent.” At the same time, the allocation of housing financing must also be simplified, especially in the case of exceptions. Cernko: “We are also happy when the states provide long-term loans with a low interest rate of 1.5 percent. This is not competition, but a good addition.” Erste recently started offering home loans of up to two percent for young families. percent since the end of the year, a total amount of 100,000 euros.
In any case, 2023 was a very successful year for Erste Group Bank: operating profit increased by 38.4 percent to an operating profit of 5.5 billion euros.
For 2024, there is particular hope for stronger growth in Eastern Europe, where the institute is well positioned. There have been notable increases in both deposits and loans, and inflation will continue to decline. We are gradually approaching the desired target of just two percent inflation in the eurozone. And it is remarkable that despite the uncertain political situation, the number of loan defaults remained very limited.
Back to housing financing: this needs to be simplified. In addition to rent and home ownership, Erste Bank sees renovation as an important point of attention.
Cernko: “We manage the financing, but due to the construction crisis it will take a year or two before there are sufficient projects on the market again.”
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
