Number of banks and branch offices

There were still 2,400 banks in Germany at the end of 2004. This is about half the number in the early 1990s. The downward trend looks set to continue, though it has slowed since the end of 2003. The number of banks fell by only 66 in 2004; in the previous year it was 126.

1995   2000   2004 (1) Number of banks 3,785   2,911   2,400 Number of domestic branches   67,930   56,936   45,467 Nnumber of domestic bank offices   71,716   59,848   47,867 Number of foreign branches   579   714   671               1) Since 2002 the figures have included securities trading banks in the category of commercial banks (regional banks and branches of foreign banks).

Source: Deutsche Bundesbank

The number of domestic branch offices also declined sharply during the 1990s. Over the last ten years – between the end of 1995 and the end of 2004 – the number of bank offices (head offices and branches) fell by one third. The rate of branch closures has also slowed somewhat in the last two years.

The banking density in Germany (population per bank office) has risen to around 1,720 inhabitants per bank office (1995: 1,140). Germany nevertheless remains one of the most densely banked countries in the European Union, not least because the number of bank offices has been on the decline in recent years in most other member states, too.

As a result of the increasing internationalisation of the business handled by German banks, the number of foreign branches grew steadily until 2003. This trend was reversed last year. The banks’ strategic repositioning and greater focus on core competencies led them to cut back operations in their foreign branches as well. This naturally applies primarily to the big banks, which have a large number of branches and subsidiaries outside Germany.

Over half the foreign branches of German banks are located in other countries of the European Union.