Do long-term premium savers have to accept termination of their attractive old contracts by banks if the premium guarantee agreed in the contract has ended? The Federal Court of Justice has issued a landmark judgment on this.

The BGH has now clarified whether savings banks are allowed to terminate attractive premium savings contracts.

BAnken can terminate savings contracts with high premium payments when the premium guarantee agreed in the contract has ended. The long period of low interest rates is an appropriate reason with which the termination can be justified. The Federal Court of Justice (BGH) decided on Tuesday. The reason given was that contract law was decisive. A lawsuit by savers against the termination was thus legally dismissed.

The landmark verdict was eagerly awaited. Because in recent years there have been controversial cases in which financial institutions have terminated high-interest savings contracts under the pressure of low interest rates.

According to an overview by Stiftung Warentest, at least 30 savings banks in several federal states had terminated premium savers by mid-April. In most cases, these terminations relate to the “S-premium savings flexible”.

In addition to a fluctuating base rate, savers received a steadily increasing premium from the third year onwards. It started with three percent on the savings contributions made. The highest possible return of 50 percent was achieved after the 15th year, a fixed term was not agreed. An old advertising flyer from the savings banks calculates a fictitious premium development over 25 years. According to this example, the saver could have taken the maximum premium eleven times. This possibility should not be denied to his clients, argued the BGH attorney for the plaintiff, Norbert Tretter. In return, they would have accepted low gains in the early years. In the specific case, which has now ended up before the BGH, savers had concluded a total of three premium savings contracts with the Kreissparkasse Stendal.

Contract terms are crucial

Customers signed one contract in 1996 and two more premium savings contracts in 2004. There reference was made to the general terms and conditions and said that both sides can terminate the contract. If the Sparkasse terminates, it must give an appropriate reason. However, the Kreissparkasse had advertised premium savings in an advertising brochure. A sample calculation with a term of 25 years was listed there. It also said: “You alone determine how long you want to save.”

In 2016 the Kreissparkasse announced. The first contract from 1996 was supposed to end at the beginning of 2017, the two contracts from 2004 at the end of 2017. The term of 15 years was adhered to. However, the savers sued for continuation and also referred to the flyer.

The BGH decided in the last instance that the terms of the contract mattered. The premium payments were listed there for 15 years, which means that termination for this period must be excluded. Thereafter, however, the termination was permissible if there was an appropriate reason. The long period of low interest rates was cited by the financial institution as an appropriate reason. That is not objectionable (AZ: XI ZR 345/18).

The German Savings Banks and Giro Association sees this confirms its legal position. “With very long-term contracts” it must be possible “to be able to react appropriately to changed economic conditions,” said a spokesman on request.