The new year begins for the municipality of Purkersdorf with a financial challenge – namely with the withdrawal from the franc loan. If the CHF loans are converted into loans in euros, around 24.6 million euros will probably remain that have yet to be repaid.
As the NÖN reported, a total exchange rate loss of four million euros is expected during the conversion. The city plans to get out of the loan as soon as possible. In the most recent municipal council meeting, city councilor Josef Baum pleaded for waiting. The city council was convinced that a softer franc rate is currently being forecast and every percentage point in the rescheduling will mean around 400,000 euros more or less.
Bank offers are currently being obtained
The municipality is currently soliciting offers from various banks in order to be able to get out with the currently best conditions, said SPÖ Mayor Stefan Steinbichler when asked by NÖN. He expects that all offers will be there by mid-January, and then there will be an extraordinary meeting of the municipal council. “We will convene an additional local council to ultimately fix the exit. When exactly that will be and how the exit will look like, is decided there. “
In 2015, the Swiss National Bank abandoned its long-term minimum peg to the euro. For foreign currency borrowers in Austria, that meant a debt increase of 20 percent at that time. At that time, the municipality decided to stick to the franc loan.
In 2018, when the state decided to get out of all foreign currency loans by 2023, there were also plans in Purkersdorf to convert the loans, says Steinbichler: “There was already a decision that we would get out. We wanted to wait for the course of 1.2, but unfortunately that has not happened since then. That is why we decided to exit again in December. “
Land sees enough potential for savings
Due to the precarious financial situation of the municipality, it was rumored again and again that Purkersdorf was placed under the state’s trustee. SPÖ Deputy Governor Franz Schnabl denies this: “The Purkersdorf community has been able to cover its current expenses with its own income in recent years and is therefore not a rehabilitation community.”
The city must plan the rescheduling costs in the budget for 2021 and in the medium-term financial planning for the years 2022 to 2025. “Due to the volume of business in the municipality, a corresponding potential for savings appears possible,” says Schnabl.
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