Massive Increase in Municipalities’ Foreign Currency Debt

Politics ♦ Published: July 25, 2011; 15:22 ♦ (Vindobona)

The amount of foreign currency debt has doubled since 2009 and surpassed € 2bn in February 2011. Swiss franc denominated loans accounted for almost 100%.

Massive Increase in Municipalities’ Foreign Currency Debt / Picture: © SW Umwelttechnik

The Austrian municipalities have strongly increased the amount of foreign currency loans over the last years, a period during which the Swiss franc gained significantly against the euro. According to the Austrian National Bank (OeNB), franc denominated loans totaled € 770m in 2009. The amount more than doubled to € 1.9bn at the end of 2010.

In February 2011, the…