The savings banks have come through the low-interest phase well. They are solid and a bit boring. When it comes to state banks, however, disputes quickly arise.
(Photo: Julian Stratenschulte/dpa)
The savings banks are the market leaders in business with private customers and small and medium-sized enterprises. They’re resilient, rock solid, and a little boring. So far, neither the long period of negative interest rates nor the sharp rise in interest rates have had much impact on the savings banks. They have coped with the growing competition from financial start-ups as well as the corona crisis.
There are even surprisingly positive figures: the Sparkassen-Finanzgruppe has had around 100,000 new private checking accounts since the beginning of 2023. Last year, the net number, excluding accounts for refugees, had already increased by more than 300,000. The 357 savings banks currently have around 36 million private checking accounts. The Sparkasse app has more than 14 million users.
So the world of public banking would be in relative order if it weren’t for the Landesbanken. The topic of Landesbanken and the question of what risks they harbor is still causing a great deal of controversy.
New start for Landesbanken consolidation is unlikely
This became clear again this week at the Savings Banks Day, the meeting of the important managers and (few) managers from the Savings Banks organization. Because almost eleven years after the rescue and break-up of WestLB, once the largest state bank, the future of NordLB is now being disputed. The Lower Saxony savings banks and the state of Lower Saxony, which together hold two-thirds of NordLB, have been struggling with the other savings banks in Germany for months about the future direction of the bank.
The German savings banks, which have held a stake of around 24 percent since NordLB was rescued three and a half years ago and can now block certain decisions, are critical of the Hanover bank’s growth course and find the spending on new bank management excessive. The state of Lower Saxony and the local savings banks, on the other hand, argue that NordLB must grow and develop in order to survive in the long term.
The dispute makes it clear that the savings banks have not used the past few years to make progress in consolidating the state banks and their units with a view to the central institutes. There are still three other large state banks – in Stuttgart, Munich and Frankfurt. And it doesn’t look like a new start at the moment.
As always, there is only one agreement within the savings bank group after a long struggle. Each of the owners involved can give good reasons for their position. Externally, however, the savings bank organization gives the impression of constant friction. The dispute over NordLB will not be the last.
More: Scholz wants to preserve the security systems of savings banks and Volksbanks