When it comes to home loan savings, most people first think of financing their own four walls.

But not only private individuals are customers of building societies, but also municipalities.

Just like the municipality of Rosengarten with its 5200 inhabitants in the north-east of Baden-Württemberg.

She has concluded four savings contracts to finance the construction of a sports hall, as treasurer Andreas Anninger reports.

He estimates the pure construction costs of the new hall at 500,000 euros.

The community is currently looking for a location for the building.

Municipalities can finance various projects through building savings contracts: This ranges from the construction of apartments and kindergartens to schools and the development of building areas.

"The regional and municipal reference of the investment measure is of decisive importance for covering the needs of the local population," says a spokesman for LBS Südwest, the largest public building society based in Stuttgart.

Municipalities are usually fully creditworthy.

A prerequisite for a municipal building savings contract is usually that the budget has been approved by the supervisory authority.

The business of building societies with the cities and communities has been picking up again for a long time.

The CEO of the Wuestenrot building society, Bernd Hertweck, says there is growing interest in this topic.

"Because the importance of stable financing with secure interest rates is not only important for private individuals, but also for cities and municipalities."

The spokesman for the Stuttgart-based institute explains: "Due to the current rise in interest rates, the home savings contract has also gained in importance for the municipalities as an interest rate hedging instrument - especially in financing."

Schwäbisch Hall has dropped out

For the year as a whole, a share of around 1.5 percent of all new business based on building society savings is expected.

Gross new business of around 11 billion euros is expected for 2022.

Last year, the new business of the largest public building society in the niche market was around 120 million euros.

The market leader in the private sector, Schwäbisch Hall, has not been running a municipal business since 2019, as a spokeswoman reports.

Apparently it was no longer lucrative.

A specific reason for the exit was not given when asked.

It should be focused on private customer business.

This is not up for debate for LBS Südwest.

"Business with the municipalities is a niche business for us, but an integral part of our offer - if only because of the public mandate of the savings bank organization." The bandwidth of the sums concluded with the Swabians ranges from 500,000 euros to 10 million euros, with exceptions also about it.