Croatia's Swiss Franc Borrowers Savour Victory Over Banks
www.balkaninsight.com

var CE_SNAPSHOT_NAME = "Article Item Default";

 
Home Page
$(document).ready(function() { $('.menu_togle').click(function() { $('#nav1041').toggle(); }); });
 
NEWS 13 Jul 18
2018-07-17 09:12:37

Croatia's Swiss Franc Borrowers Savour Victory Over Banks

Indebted Croatian Swiss franc borrowers and the Franak Association, which represented them, are hailing their final 'David vs Goliath' court victory over the banks.

Anja Vladisavljevic
BIRN
Zagreb
A woman holds a banner reading 'that is enough franc loans' during a protest to demand the conversion of Swiss franc-denominated loans into Croatian kuna in front of Croatian National Bank (HNB) in downtown Zagreb, Croatia, 25 April 2015. Photo: EPA / Antonio Bat

Croats stuck with huge debts over loans taken out in Swiss Francs are celebrating a final court ruling in their favour on Wednesday – confirming an initial verdict five years ago.

“This is an example of the battle between David and Goliath. A small David with vision and faith can defeat the giant,” Ines Bojic, the lawyer for the Franak Association, which filed the lawsuit against eight banks, said.

The High Commercial Court in Zagreb on Wednesday dismissed the appeals of the banks in the case of loans taken out in Swiss francs, ruling that the currency exchange clause in the case of franc-indexed loans was now nullified.

The Franak Association has been lobbying for years for the rights of people with loans in Swiss francs in cooperation with Croatia's Consumer Protection Association, UZP.

Around 120,000 Croatians took out loans pegged to the franc between 2005 and 2008, attracted by the lower interest rates.

They faced disaster after the franc unexpectedly soared in value after the 2008 global economic crisis, leading to a sharp rise in their monthly instalment payments.

Economists, lawyers, mathematicians, political scientists and other people then banded together on the Internet, and decided to take action to improve their position and force the banks to convert the loans into loans in the national currency.

Following the latest court ruling, the Croatian borrowers can now file lawsuits against the banks individually, seeking annulment of their loan contracts.

Consumer rights groups had demanded that the banks help borrowers by lowering the interest rates, but the banks refused.

The Franak Association then launched legal action against Raiffeisen, Hypo Alpe Adria, Zagrebacka, Privredna, Erste, OTP, Splitska and Sberbank.

On 4 July 2013, the Zagreb Commercial Court issued a ruling in their favour, saying the banks did not have the right to offer loans with variable loan equity and variable interest rates.

“Such a combination is absolutely unacceptable for such a long period of several decades and at times when the exchange rate floats,” Juge Dobronic said.

The judge ordered the banks to convert the franc loans into Croatian currency, and change variable interest rates to fixed ones.

Dobronic said the banks had violated consumers’ rights because they were not adequately informed and so not in a position to properly assess whether to take out the loans or not.

The banks had the right to appeal the 2013 ruling – and used it. Now, however, the matter has been finally solved, five years ago after that verdict.

According to some estimates, the banks could end up having to pay back up to 10 to 15 billion kunas, or between 1.35 billion to 2 billion euros.

Members of the Franak Association assume the banks will fight by all means to ensure this does not happen, which is why it has recommended its members to go with lawsuits, adding that they are ready to help all of them.

Meanwhile, the mood is enthusiastic.

Citing Croatia's World Cup sensational win over England on Wednesday, it said: "We cannot get rid of the impression that our victory is very similar to the victory of our footballers in the semi-final match with the English".

For both victories, sacrifice, work, will, perseverance and trust were needed, it added.

Read more:

Hike in Swiss Franc Causes Panic in Croatia

Croats Hit by Soaring Swiss Franc Call Protest

Croatia Banks Overcharged On Loans, Court Rules


Talk about it!

var disqus_shortname = 'balkaninsight';(function() {var dsq = document.createElement('script'); dsq.type = 'text/javascript'; dsq.async = true; dsq.src = 'http://' + disqus_shortname + '.disqus.com/embed.js';(document.getElementsByTagName('head')[0] || document.getElementsByTagName('body')[0]).appendChild(dsq);})();Please enable JavaScript to view the comments powered by Disqus.blog comments powered by Disqus

Premium Selection

bulgarian-student-fears-jail-over-anti-fascist-protest-11-23-2018
26 Nov 18
2018-11-26 13:00:35

Bulgarian Student Fears Jail Over Anti-Fascist Protest

A student’s attempt to stage a graffiti protest has got caught up in the complex politics surrounding the memorial in Sofia to the Red Army.

uranija-pirovska-zaev-is-disappointing-people-s-expectations--11-26-2018
26 Nov 18
2018-11-26 16:49:44

Uranija Pirovska: ‘Zaev is Disappointing People’s Expectations’

The head of Macedonia’s Helsinki Committee, Uranija Pirovska, says Nikola Gruevski’s escape and other worrying developments are fast destroying hopes of a return to the rule of law in Macedonia.

26 Nov 18
2018-11-26 13:00:20

Croatia Angers Orban Ahead of Landmark Visit

22 Nov 18
2018-11-23 14:32:22

Serbia Remains Out of Line With Israel at UN

Copyright BIRN 2007 | Terms of use | Privacy Policy
(function() {var _fbq = window._fbq || (window._fbq = []);if (!_fbq.loaded) {var fbds = document.createElement("script");fbds.async = true;fbds.src = "//connect.facebook.net/en_US/fbds.js";var s = document.getElementsByTagName("script")[0];s.parentNode.insertBefore(fbds, s);_fbq.loaded = true;}_fbq.push(["addPixelId", "857120171010241"]);})();window._fbq = window._fbq || [];window._fbq.push(["track", "PixelInitialized", {}]); window._fbq.push(["track", "PageView", {}]); window._fbq.push(["track", "ViewContent", { premium: (function() { if($("#premium_content").length) return true; else return false;})() } ]); setTimeout(function(){var a=document.createElement("script"); var b=document.getElementsByTagName("script")[0]; a.src=document.location.protocol+"//dnn506yrbagrg.cloudfront.net/pages/scripts/0026/2375.js?"+Math.floor(new Date().getTime()/3600000); a.async=true;a.type="text/javascript";b.parentNode.insertBefore(a,b)}, 1); $(document).ready(function() { $('head').append('<link rel="standout" href="' + $('span.standout').text() + '" />'); });
setTimeout(function(){var a=document.createElement("script");var b=document.getElementsByTagName("script")[0];a.src=document.location.protocol+"//script.crazyegg.com/pages/scripts/0035/7079.js?"+Math.floor(new Date().getTime()/3600000);a.async=true;a.type="text/javascript";b.parentNode.insertBefore(a,b)}, 1);

conditional positive