KPMG Law advises Sparkasse Dresden on interest backpayments for premium savings contracts

The Dresden Higher Regional Court partially allowed the appeal of Ostsächsische Sparkasse Dresden in the matter of interest backpayments on premium savings contracts. The OLG’s rejection of the plaintiff’s method of calculating the rate of change significantly reduces the back payments.

KPMG Law Rechtsanwaltsgesellschaft mbH (KPMG Law) is representing the Sparkasse together with the law firm Thümmel, Schütze & Partner in this and a number of similar proceedings. The subject matter of the lawsuit decided by the Dresden Higher Regional Court by judgment of April 13, 2022 in II. Instanz entschiedenen Rechtsstreit, Az. 5 U 1973/20, was the “S premium savings flexible” savings model. The contract concluded with a saver in 1994 provided for a variable interest rate on the savings deposit and, from the third year of savings, a fixed and graduated interest-bearing premium. During the term of the contract, the savings bank successively reduced the variable interest rate. The interest rate reductions, which in his opinion were unjustified, prompted the saver to take legal action after the end of the contract to demand additional interest payments.

With regard to the variable interest rate, the Savings Bank had a right to change the interest rate, which was exercised by means of a notice in the cashier’s office. This provision did not stand up to the court’s review of the content of the General Terms and Conditions. As non-transparent for the customer, the clause on interest rate changes was invalid. This left a gap in the savings contract. It was the task of the court to find a standard for the change of the variable interest rate by way of supplementary interpretation of the contract which corresponds to the concept of the concluded savings contract and is in line with the interests of the customer.

The saver requested the calculation of the monthly change in interest rates based on the moving average of the last ten years of the current yields of domestic bearer bonds/mortgage bonds with an average remaining term of ten years. The OLG rejected this interest rate series of the interest rate statistics of the Deutsche Bundesbank as a reference interest rate. Instead, the 5th Senate, which is responsible for banking law, decided that the interest rate must be based on the monthly actual interest rates published by the Deutsche Bundesbank for listed German government securities with a remaining term of 8 to 15 years.

According to the court, these interest rates reflect the long-term nature of the savings contracts, level out outlier effects, come closest to the typified savings period of 15 years, and still leave room for liquidity aspects. Due to their high liquidity without significant implicit and explicit costs, they represented the so-called “risk-free interest rate”, which took into account the guarantor liability applicable at the time of contract conclusion. In contrast, bond interest rates for mortgage Pfandbriefe contained a risk premium despite the collateralization, which seemed inappropriate as a reference, since the savings bank owed a fixed premium in addition to the variable interest rate.

A fundamental argument against the use of moving averages of reference interest rates is that the use of such past interest rates would be tantamount to a representation of the variable interest rate in a fixed-interest position. However, the savings contract promised a fixed interest rate in the form of a premium and, in addition, a flexible variable interest rate adjusted to the changing market situation.

According to the court, the relative difference between the initial interest rate and the reference interest rate must also be taken into account when calculating the actual interest rate.

This ruling means that there are good prospects of defending against excessive claims and finding out-of-court solutions between the savings bank and customers with similar old savings contracts that are in line with their interests.

Consultant Ostsächsische Sparkasse Dresden:

KPMG Law Rechtsanwaltsgesellschaft mbH: Dr. Matthias Aldejohann (Partner, Lead), Philipp Glock (Partner), Miriam Golla (Manager), Markus Zawalich (Senior Associate, all Legal Corporate Services)