Market shares by category of banks

The public-sector banks have the largest market share measured in terms of total assets. The savings banks and Landesbanks together hold over 34%. If the public special purpose banks, mortgage banks and building and loan associations are also included, around 45% of the German banking market is in the hands of the public sector.

Table: Market share by category of banks

The credit co-operatives and co-operative central institutions together have a market share of almost 12%. This figure does not take account of the co-operative mortgage banks. The market share of the private-sector banks excluding the co-operative sector and the private building and loan associations is around 38%.

The commercial banks lead the market in lending to domestic enterprises and in commercial loans, i.e. loans to enterprises and self-employed persons for purposes other than house building. This shows that the private banks remain committed to corporate lending. The commercial banks remain market leaders in this area despite the fact that their customers are among the most keen to make use of other funding sources (capital markets, borrowing abroad).

The savings banks have traditionally had the biggest share of the market in loans to individuals. The commercial banks are the clear leaders when it comes to international banking. This applies above all to interbank dealings, though admittedly the banks’ transactions with their branches outside Germany account for a considerable part of these operations. But the private banks also have the largest share of the market in business with foreign non-banks.

On the liabilities side, it is interesting to note that the deposits of foreign banks in Germany are held almost exclusively with the commercial banks and the Landesbanks. More than half the total savings deposits remain with savings banks, around 30% are held by the credit co-operatives and only just over 15% by the commercial banks.

One-third of the banks’ bearer debt securities were issued by mortgage banks and over a quarter by Landesbanks. For both categories of banks, issues of collateralised debt securities are an important source of funding. The special purpose banks also use the capital markets as a major source of funding. The excellent ratings of these banks stand them in good stead in this respect. The commercial banks used to raise a significant amount of capital on the markets as well. They have made little use of this method of funding in recent years, however, because the associated costs were too high.