Commercial real estate: Are new credit rules slowing down residential construction?

Reason enough for the guardians of the domestic financial market to introduce stricter rules when granting loans – similar to the KIM regulation regarding the granting of private home loans. This very controversial regulation has now more or less expired. However, a new regulation is causing discussions in the industry. The sectoral one introduced last year Systemic risk buffer for loans for commercial real estate of 1.0 percent was doubled as of July 1st. In 2027 it is expected to rise again to 3.5 percent.

Loans could become more expensive and construction output would decline

The bankbut also the economic research institute WiFisee this critically. The fear is that this would make loans more expensive, which would lead to lower construction output on the market. The FMA cannot confirm this to the KURIER and refers to current figures Financial Stability Board (FMSG) for the first quarter.

Since the measure was announced two years ago, the cost of loans has neither increased (both in absolute terms and in comparison to other loans), nor has the volume of new loans decreased. This is not a special Austrian case, but it has been shown time and again since the financial crisis that better capitalized banks do not grant less credit, according to the FMA.

Winners and losers of the new regulations

Die Loans However, banks would move from weaker to more heavily capitalized banks, which would then be better prepared for possible losses. This is not an undesirable aspect. Other key figures on the balance sheets of domestic banks in the first quarter are also interesting: operating income increased by 13 percent year-on-year to around 10.5 billion euros, while expenses increased by only 4 percent to just under 6 billion euros.

Both Risk provisions there was an increase of 127 percent to almost one billion euros. Total profits rose by 14 percent to around 3 billion euros. At the same time, the common equity Tier 1 capital ratio fell by more than one percentage point to below 18 percent. According to FMSG, capitalization fell as a result of the acquisitions in Southeastern Europe.

Risk costs have fallen significantly at regional banks

The results of a study also match the domestic ones Regional banks. The consulting company zeb notes that although the risk costs fell significantly in the previous year, they were still at a significantly higher level than during the Corona period. Net interest income is also clearly declining. “Due to the comparatively high proportion of variable loans, there is pressure on margins,” says Michaela Schneiderpartner at zeb.Austria. The fact that the regional banks are under pressure is also reflected in the fact that the number of institutions has fallen by 20 to 339 within a year.

“The next few years will determine whether regional banks can stabilize their profitability and invest in their future, or whether they will enter a phase of significant decline Self-financing power advised. “2026 will therefore be an important decision-making year for banks,” says Schneider. She basically assumes a moderate economic recovery. As a result, it will normalize interest rate structureinsolvencies would decline and regional banks could stabilize their earnings situation with increasing investments in digitalization and AI.