“Over 40 million Europeans use the Bauspar product and benefit of its advantages, out of which 500,000 are Romanian. The experience of European countries (Germany, Austria, Czech Republic, Slovakia etc.) demonstrates that the Bauspar system is a sustainable solution for improving housing conditions among families with medium and under medium incomes. The Bauspar system generates important social effects, as the investments in improving housing conditions represent an economic growth engine and an important factor in creating jobs (in construction and related fields). We consider that there is a significant growth potential of the Bauspar system in Romania, up to a similar penetration level to those of other European countries”, stated Mr. Jan Jeníček, President of EFBS.
At the end of 2016, the assets held by the banks which are members of the European Federation of Building Societies amounted to more than EUR 265 billion.
The European Federation of Building Societies was established on August 29, 1962 and was one of the first credit sector federations at European level.
The main objectives of the European Federation of Building Societies are:
- promoting the idea of home ownership,
- representing the interests of its members in the European Union,
- ensuring that its members are kept informed about progress in European unification and about the measures taken to this end by bodies of the European Union and
- supporting and intensifying mutual information and exchange of experiences among its members in the fields of housing finance and housing policy.
EFBS is the “voice” of European housing financing. The Federation focuses on housing financing with a stable own capital base that proved to be robust during the crisis.
Brief history of the Bauspar system
The Bauspar system has greatly contributed to the reconstruction of Europe in the ‘50s. The Bauspar system provided for the institutional ‘working framework’ required to provide assistance during a time interval when other financial resources were limited or very expensive. The Bausparkassen provide safe mortgage credits, restrict the interests and share the risks.
The fundamental principles of the Bauspar system are straightforward. First, the Bauspar client saves, then the Bausparkasse grants loans for housing from the savings fund, to those clients who pursue such a loan and are eligible for it. Consequently, it is not surprising that the Austrian and German Bausparkassen played a vital role in the reconstruction of the housing sector in that period.
A well-developed Bauspar system contributes to economic stability due to the counter-cyclical business model. The stabilisation function has proven itself again during the worldwide financial crises of 2007 - 2008. While other creditors were worried about the lack of funds or the problematic loans in other currencies, the Bausparkassen were able to grant loans to their clients.
The Bauspar system is an important component of the financial system. It is recommended that the emerging economies support the development and expansion of such a system. Important supporting elements consist in the accessibility of the Bauspar system for all segments of the population, including for those with average or below average-income individuals, and also in the fact that the government grants an attractive bonus for deposits, while such bonus is accessible to everyone, irrespective of their age.