Postal savings bank scandal

from Wikipedia, the free encyclopedia

The uncovering of the worst losses of the Austrian Post Office Savings Bank in 1926 and the associated political effects are described as the postal savings bank scandal .

With the collapse of Bodencreditanstalt (1929), the crisis of Creditanstalt (1931) and the Phoenix scandal (1936), the postal savings bank scandal that broke out in the second half of 1926 following the crisis in the Central Bank of the German Savings Banks was one of the biggest financial scandals in Austria of the interwar period . It essentially grew out of the loss-making, speculative interaction between the management of the state financial institution and the large speculator Siegmund Bosel .

Background and history

At the beginning of the twenties, the Austrian economy and especially the banking sector were shaped by inflation and the stock market crash. The galloping inflation , which peaked in 1922 and flared up again in 1923, had largely devalued not only the savings of large sections of the population, but also the assets of the banks. In connection with the Geneva redevelopment and the associated advance payments for dismantled federal employees, there was also a sudden flow of money, which was often invested in securities and drove up share prices. In 1924 this bull market collapsed.

Course of the crisis

As early as July 1922, the chairman of the banking commission Wittek, a former finance minister of the Danube monarchy , informed the then Federal Chancellor Ignaz Seipel about questionable foreign exchange transactions of the Post Office Savings Bank. This did not result in any measures, however, and the PSK's gold balance of 1925 untruthfully showed a profit and a reserve fund, while in fact it should have been concluded with a loss of about a hundred times the amount of the alleged reserve fund.

On September 22nd, 1926, the long-time governor of the Post Savings Bank Schuster suddenly resigned, after Karl Ausch's judgment he was more of an administrative officer than a financial expert. At around the same time, the left-wing sensational newspaper Der Abend , which is always well informed in financial matters, began a series of articles about the Post Office Savings Bank. Unlike in the case of the Central Bank affair , the revelations of the "evening" did not result in a bank run on the PSK, which enjoyed special trust as a state institute.

At the beginning of November 1926, the subcommittee of the finance committee, which had been in parliament since 1924, was entrusted with the investigation of the mismanagement in the PSK. The deliberations of the parliamentary committee in question showed that the enormous losses suffered by the PSK had essentially come about in three ways:

  1. through PSK's own speculation in securities and foreign exchange
  2. through transactions between PSK and Siegmund Bosel
  3. through restructuring and relief actions for banks in difficulty, mostly close to the Christian Social Party (such as the "Österreichische Allgemeine Kreditbank", the "Austro-Holländische Bank", the "Austria-Bank", the "Allgemeine Industriebank", the "Agrarbank für die Alpenländer ", the Tiroler Vereinsbank", the "Austrian Commercial Bank" and the "Wiener Lombard- und Escomptebank").

The total losses not only exceeded PSK's equity, but were in the range of around 30 percent of the funds deposited with it.

The origin of these gigantic losses lay in the fact that the old postal savings bank law, which dates back to the times of the Danube Monarchy, did not allow this institute to purchase shares. In the inflation period after the First World War, however, the investment in government securities made even less sense, so the PSK began, contrary to its legal stipulations, to carry out securities and foreign exchange transactions on a large scale. Deputy governor Klimesch, who is actually in charge of the institute, was probably responsible for this. This did not want to appear directly on the stock exchange, but used Siegmund Bosel as a middleman. During the big share bull market of 1923, the Postsparkasse (with the currency already stabilized) became Austria's largest stock market speculator. The collapse of this bull market resulted in the first major losses for the Post Office Savings Bank and Bosels. As a result, it turned out that he had accumulated large debts from his business relationship with the PSK. He was treated very carefully in this matter. This remarkably benevolent treatment of Bosel was demonstrated by Finance Minister Jakob Ahrer , who temporarily emigrated to Cuba in September 1926 shortly before his role in the PSK scandal was revealed. But also the long-standing governor of Lower Austria and temporary Federal Chancellor Karl Buresch was said to have a close relationship with Bosel and to be involved in the postal savings bank scandal.

literature

  • Karl Ausch : When the banks fell - on the sociology of political corruption. Vienna 1968
  • The Austrian economist , especially the second half of 1926