As of 31 December 2012, the banking sector in Germany comprised 2,053 banks, a decline
since the time of the FSAP when, at year-end 2010, there were 2,093 banks. A salient feature
of the German banking system is its three-pillar structure:
The commercial banking sector consists of
275 institutions, accounting for a market
share (with regard to local business) of
The sector includes four major
internationally active banks, 163 regional
banks and credit institutions and 108
branches of foreign banks (market share
according to total local assets of 3.7%).
-Germany N° of banks: 1811
Savings banks represent the second pillar
Sum of banks of the system and consist of 432
institutions with a market share of 30%. Savings banks conduct regional business
based on the regional, non-competitive principle. In addition, eight Landesbanken –
which carry out their own business, primarily for small and medium-sized enterprises
– support the regional institutions with a comprehensive range of services. The
winding-up of West LB is one of the major changes occurring within this sector in
The third pillar is represented by 1,002 cooperative banks, together accounting for a
market share of about 13%. Two cooperative central banks complete this sector.
In addition to the universal banks described above, there are several specialised institutions:
18 mortgage banks, 15 business development banks and 22 building and loan associations.
There are also 1,559 financial services institutions and 32 securities trading banks.
Pre-tax earnings at the end of 2012 stood at an aggregate EUR 30.2 billion for the 1,754
reporting institutions. This was virtually unchanged from 2011, but much higher than in
previous years. Earnings were supported by historically low loan loss provisioning due to a
favourable macroeconomic environment in Germany.
The results of the Basel III quantitative impact study showed that, on average, the 42 German
banks participating in the exercise complied with Basel III common equity tier one capital
requirements of 7% as of year-end 2012. The sum of individual capital shortfalls for the
seven large and internationally active banks remains at about EUR 14 billion; it is worth
noting, however, that this figure has decreased by EUR 16 billion in the six months since
June 2012. Preliminary results for June 2013 indicate a further reduction. This improvement
is attributable to increases in regulatory capital as well as a reduction in risk-weighted assets.