Lending to the domestic private sector by the commercial banks

For the big banks, corporate loans play a significantly more important role than retail loans. The picture painted by the statistics is somewhat distorted, however, inasmuch as most of the housing loans extended by the big banks – with the exception of HypoVereinsbank – are handled by their mortgage bank subsidiaries.

For the branches of foreign banks, lending to the domestic private sector focuses even more strongly on corporate loans. Their loans to individuals are almost all consumer loans; these banks extend virtually no housing loans.

% of balance sheet total   All comm. banks   Big banks   Regional banks   Branches of foreign banks   Loans to enterprises and self- employed persons   16.6   15.3   18.8   20.7   -Housing loans   3.9   3.5   5.3   0.0   -Commer- cial loans   12.8   11.8   13.5   20.7   Loans to individuals   13.9   10.6   22.3   5.6   -Housing loans   9.1   9.0   10.8   0.0   -Consumer loans   4.8   1.6   11.5   5.6

Source: Deutsche Bundesbank, for year-end 2004.

It is a very different story at the regional banks. These do far more business with retail customers than do the other two sub-groups, not least because interbank transactions play a much less important role for regional banks. The volume of retail lending is also higher than loans to enterprises and the self-employed. The difference between regional banks and big banks in the relative significance of consumer loans is particularly striking.