The savings banks in Hesse and Thuringia are feeling the effects of inflation: many customers can no longer save. The costs of the savings banks themselves are also increasing.
(Photo: Vedder, Mario / Keystone)
Frankfurt The lower ability of many people to save is also reflected in the 49 savings banks in Hesse and Thuringia. In the first half of 2022, customers withdrew around 50 million euros in deposits, according to the Savings Banks Association. The deposit portfolio was recently at a good 117 billion euros.
Although this is only a slight decline, it is also a trend reversal. “The high annual growth rates of four to eight percent in recent years seem to be a thing of the past,” said Stefan Reuss, President of the Savings Banks Association of Hesse-Thuringia. On the one hand, he cited catch-up effects in consumption after the end of the corona restrictions.
On the other hand, the high inflation has left its mark on savings behavior. Everyday goods and energy have become much more expensive compared to the previous year. “This limits the savings potential of many people accordingly and slows down the inflow of deposits at the savings banks,” said Reuss.
Savings Bank President Helmut Schleweis warned of the dramatic consequences of the increased cost of living at the Handelsblatt Banking Summit last week. “The crisis and the loss of prosperity are affecting the middle class, which has not been used to receiving transfer payments and has even refused in some cases,” said the head of the German Savings Banks and Giro Association.
Top jobs of the day
Find the best jobs now and
be notified by email.
Schleweis fears that in future 60 percent of German households will no longer be able to cover their expenses with their monthly income – or even slip into the red. That means that people with a net household income of 3,600 euros are also affected, the head of the association calculated. In view of this situation, observers also expect more personal bankruptcies.
>> Read here: Commerzbank boss calls for pragmatism when looking for energy partners
Deposits rose slightly in the first half of the year across all of the 360 or so German savings banks. Customer balances increased by EUR 600 million, but in the same period of 2021 the savings banks still received EUR 25 billion – a decrease of 98 percent. In the first half of 2020, the inflow of funds was even at almost 30 billion euros.
Short term uncertainty
Lending business continued to grow at the savings banks overall in the first six months – also in Hesse and Thuringia. The loan portfolio there rose by three percent and thus more significantly than in the same period last year to almost 91 billion euros. According to Reuss, growth was primarily due to corporate customers.
With a view to the coming months, Reuss referred to the great uncertainty in the development of gas supplies and supply chains. However, the turnaround in interest rates will “sooner or later also have a positive impact on the profit and loss account of the savings banks, even if we are currently still seeing its negative sides in the form of increased depreciation in the securities area”. The rising yields on bonds and the corresponding falling prices lead to write-downs in the securities portfolios of the savings banks.
However, high inflation also means higher costs for the savings banks. “Even when it comes to administrative expenses, we can’t avoid the subject of inflation,” said Reuss. The material expenses of the savings banks will increase. “Prospectively, this also applies to personnel expenses.”
More: Middle class concerns: “The number of people who can save will decrease”