Banking in Germany

The German banking system is one of the largest in the world. Unusually in the German banking system is very low by international comparison market share of private banks in relation to the public and co-operative credit institutions. This is largely responsible for the unusual structure of the German banking system. Major international banks from Germany, the German Bank and Commerzbank.

A company is required by § 1 of the German Banking Act ( KWG), then a credit institution when it conducts banking business commercially or on a scale which requires a commercially organized business undertaking.

In Germany, the Federal Financial Supervisory Authority ( BaFin) exercises supervision of credit institutions and financial services institutions that needs the exercise of banking transactions explicitly approve. The number of reporting institutions According to the Bundesbank is 2,277 banks by the end of 2007. The added total assets amounted to 7.626 billion euros.

Banking

Sub-bank transactions within the meaning of the Banking Act shall be taken:

• Deposit business: The acceptance of funds as deposits or other repayable funds from the public if the repayment claim is not represented by bearer or order debt is, regardless of whether or not interest is paid.
• Lending: The granting of money loans and acceptance.
• Discounting: The purchase of bills of exchange and checks.
• Financial brokerage: The purchase and sale of financial instruments in its own name on behalf of others.
• Depot Business: Custody and administration of securities for others.
• Investment Business: The 2 Investment Act referred to in § 7 para shops.
• Loan acquisition business: entering into the obligation, to purchase loans receivable before maturity.
• Guarantee business: The acquisition of bonds, guarantees and other guarantees for others.
• Giro Business: The implementation of cashless payment and clearing services.
• Origination: The acquisition of financial instruments for its own risk placement or acquisition of equivalent guarantees.
• E- money business: The issue and administration of electronic money.

These businesses include only the " outside business " of the credit institution in the sense of economics. These are:

• Deposit business to other banks ( interbank trading )
• Lending to other banks ( interbank trading )
• Deposit transactions over the central bank ( for refinancing ). This is the basis for that at all cash in circulation: The central bank leaves money in a certain amount to the bank, which undertakes, in return, to repay money in this amount later at the central bank.

The law defines exceptions: The German Federal Bank, the Bank for reconstruction, social security institutions and the Federal Employment Agency, for example, are not credit institutions within the meaning of the Act.

A commercial bank is a bank, the Central Bank is not within the financial sector. The commercial banks are in addition to the central bank's non-banks as customers over.

Structure

The end of 2010 was one of the German Bundesbank 2,093 banks with 38,183 branches. Included herein are the building societies, but not investment companies. Characteristic of the banking system in Germany is the three-pillar structure. This is the strict separation in the column co-operative banks ( 1,144 credit unions and two cooperative central banks ), public institutions ( 431 savings banks and 10 regional banks and specialized institutions ) as well as 218 private banks (4 banks, 159 regional and other banks and 96 branches of foreign banks) referred to.

In an international comparison of the degree of consolidation is low and the proportion of the public sector with about 45 % high. The profitability of German banks is below average in international comparison - this applies to all three pillars. In 2003, the return on equity was only 0.7 %. Meanwhile, the risk provisions decreased significantly, including through the sale of so-called Lazy loans or non-performing loans.

In Germany, the return on equity is used to compare the efficiency and performance of a bank usually. (For comparison: In the U.S., the cost- income ratio is the most important economic code. )

The banking system in Germany is governed by the Banking Act ( KWG). It is divided into three sectors: private, public and cooperative banks ( three-pillar system ).

Private commercial banks

The private commercial banks include:

• The major German retail banks ( German Bank, Commerzbank, Unicredit Bank). They serve historically the major industries and high net worth individuals. You have abroad through branches to act on behalf of their major customers there. To this group belonged to its merger with Commerzbank, Dresdner Bank. Postbank, which also belongs to this group, in 1990 it emerged from the post office and postal savings offices of the German Federal Post Office and serves as a traditional retail bank mainly for retail customers. All four banks operate in the legal form of the corporation.
• Regionally active German retail banks (eg Oldenburgische country Bank, National Bank, West Bank)
• Direct banks (eg ING DiBa, Comdirect Bank AG, German Credit Bank)
• Private Bankers, which always occur with general partners and operate in the legal form of limited partner or general. For private bankers are mainly to banks, which have traditionally serving affluent customers to the destination ( eg Berenberg Bank). The larger players are also active in investment banking (eg, Berenberg Bank and Sal Oppenheim jr. ). The oldest continuously family-owned private bank in Germany 's Berenberg Bank. The Fürst Fugger private bank was founded in 1954, but is as much as HSBC Trinkaus has now become a group ( Nuremberg and HSBC ).
• Foreign banks. These are divided into two subgroups: First, banks that have built up in Germany its own retail business and with a nationwide branch network operate (eg Targobank, Santander Consumer Bank ) and second, the branches of foreign banks operating in the care of the original customer Germany made ​​(eg ABN AMRO )
• Private Mortgage banks that issued collateralized mortgage bonds. As real estate loans loans that do not exceed 60 % of the mortgage lending value shall apply. (such as Hypo Real Estate Holding AG)
• Private building society (eg building society BHW AG)

Public sector banks

Among the public sector banks include:

• Seven Landesbanken (LBBW, BayernLB, HSH Nordbank, LBB, Helaba, NORD / LB, SaarLB ). They offer themselves to any retail business, but have it partly subsidiaries. These are the BW - Bank, LBBW, Braunschweigische Landessparkasse of NORD / LB, which belongs to the BayernLB Group DKB and Frankfurter Sparkasse Helaba. The products of the country's banks are distributed by the affiliated savings banks. Furthermore, the country's banks are bank of the country and our major customers.
• The Federal agency KfW banking group, an institution under public law to carry out public missions, such as the promotion of SMEs and start-ups, investment loans to small and medium enterprises and financing of infrastructure projects and housing, financing of energy-saving technologies, municipal infrastructure, education credits, export and project finance and the area of ​​development cooperation.
• The central bank of the savings banks Deka Bank, an institution under public law.
• Around 450 savings banks, whose owners ( cities and counties ) to use the profits for the common good.
• Landesbausparkassen (LBS )

Cooperative sector

The cooperative banks include:

• The two central banks DZ Bank and WGZ Bank. This practice of central banking functions for the cooperative banks. This includes the handling of foreign business, the provision of capital market products that support larger corporate clients and risk sharing in the credit business.
• Approximately 1,250 local cooperative banks. The cooperative banks act as SME financier. You have as objective the promotion of members. The cooperative banks have the largest branch network in Germany.
• Twelve Sparda banks
• Fifteen PSD Banks
• Specialized institutions in the composite Fund company ( Union Investment )
• Property fund manager ( Union Investment Real Estate )
• Building society Schwäbisch Hall
• Mortgage banks ( DG Hyp, WL Bank, Munich Mortgage Bank )
• Leasing company (VR Leasing )
• Insurance Company (R V Versicherung )
• IT service Fiducia IT, GAD

In addition, the cooperative sector is involved in the following banks:

• Travel Bank, Frankfurt am Main, ( 100% subsidiary of DZ BANK )
• DVB Bank, Frankfurt am Main, ( 93.3 % for DZ BANK )
• German Securities Services Bank, Frankfurt am Main, ( 50% for DZ BANK )

The largest credit institutions in Germany

An overview of the largest banks in Germany (Reference size: total assets, if available ) gives the following table, which is based on the establishment of the journal, the Bank and the annual reports of individual banks for the year 2008.

Due to the initial accounting for all top 10 banks, with the exception of the Hypo Real Estate IFRS 2007, the values ​​have changed greatly. In the source, the figures for 2006 were adjusted to the IFRS rules, this has been omitted here. For the Hypo Real Estate since 2006 are values ​​. (: EUR 483.7 billion in 2007 ), the German Federal Bank, which would have taken with total assets of 612.5 billion Euros in 2008 to third place traditionally not appear in the list.

International importance of German credit institutions

In the last thirty years took place strong position shifts among banks by countries in global financial markets. The have always been rather low-yielding compared, however, the balance sheet strong German banks were freed by the economic strengthening of Japan since about 1970 and China since 2004, as well as by the wave of mega-mergers of banks, particularly in France and Japan, according to the criteria of total assets, market capitalization and core capital increasingly pushed. Despite a sharp increase in yield of most German institutions in 2005 and in some cases despite significantly increased core capital and total assets were also grown German institutions in all points of comparison in relative terms further. Due to the lower international scale concentration of the German banking market, it is also related that among the 25 or top 100 institutions in the world, relatively few German banks (1 or 4-7, depending on the criterion, see below), although the German banking market to the largest ever heard. Among the largest banks in the world in 1000, there are, however, in proportion to significantly more German institutions, namely about 100 banks ( 2005: 98), corresponding to a share of 10 %.

Taking the total assets based on only one of the major German banks was in 2005 among the 25 largest banks in the world, the German Bank ( ranked 12). 2003, there had still been all four major German banks.

Worldwide Leader in 2005 to $ 1,591 billion, the British Barclays Bank (previously Leading Japanese Mizuho Financial Group was ranked only on rank 10), second- placed Institute was 1568, the Swiss UBS ( in the previous year, the U.S. Citigroup ). The 25 leaders by total assets were distributed in 2005 to the following countries:

Among the 50 largest by total assets were located in 2005 following German credit institutions:

According to the terms of market capitalization ( market value ) was 2005, again only one institution, in turn, the German bank, in the Top 25, at No. 23 (previous year: No. 21, 2003: 17th). Was Here - as in previous years - the U.S. Citibank leader with USD 242 billion. The 20 largest by market value in 2005 was distributed to the following countries ( values ​​in brackets from 2003 ):

In terms of core capital also was the only German bank among the top 25 in the world. Worldwide at the top stood again in 2005 Citigroup with a core capital of $ 79.4 billion. Among the top 100 in 2003 following German credit institutions were (as of 2005 ):

At the 2011 Cannes published on behalf of the G -20 summit list of the 29 most important financial institutions, there were two German banks: German Bank, Commerzbank. The German bank was here with a balance sheet total of EUR 2282.48 billion, the largest bank, with an equity ratio of 2.27 % ( 28.Platz ). In comparison, the Commerzbank took the 23rd place with total assets of 683.68 billion euros and an equity ratio of 3.35 % ( 24th place ).