Sparkassen The german Savings Banks 200 years of public banking serving the general public, SME s and communities

Transcription

1 Sparkassen The german Savings Banks 200 years of public banking serving the general public, SME s and communities Germany has established financial institutions that are not only successful in themselves, but at the same time promote social cohesion. That is the great accomplishment of the savings banks. The savings banks are exemplary models of how to combine increasing economic well-being with freedom in solidarity. The Lord Ralf Dahrendorf ( ), 2001 in London Former European Commissioner, Member of the British House of Lords, Director of the London School of Economics and Warden of St Antony s College, University of Oxford Wolfram Morales Head of the Office of the Executive President

2 To wich institutions do you have large confidence? Police President of the Republic Doctors Sparkassen (Savings Banks) Government Parliament Catholic Church Private Banks

3 German Sparkassen Seit e 3

4 The Structure of the German Banking Market The German banking industry is built upon three pillars: Credit Banks Mega-Banks Regional Banks Private Banks Foreign Bank Subsidiaries (target: profit maximization) Savings Banks Landesbank Companies Regional Building Societies (target: universal coverage of the population and SME s with financial services) Co-operative Banks Volksbank Companies Raiffeisenbank Companies and their central or affiliate Institutions (target: economic promotion and support of members) All credit institutions in Germany are subject to the German Banking Act (KWG) and to the supervision of the ECB and the Federal Financial Supervisory Authority (BaFin) Each of the three pillars has its own guarantee system and its own business model

5 The Savings Banks Finance Group Network 50 millions customers* / employees / more then 600 companies * Population 81,2 millions 416 independent Sparkassen 6 Landesbanken 9 Regional Building Societies 11 Regional Public Insurance Groups 1 DekaBank (investment fund company) 5 Leasing-Companies 4 Factoring-Companies 8 Real Estate Companies 68 Investment Companies 1 Sparkassen-Broker 1 Publishing Company (Sparkassenverlag) 12 Regional Savings Banks Federations 11 Sparkassen-Academies 1 Federal Association (DSGV) 1 IT-Service Center 1 Data Center 738 Foundations for the promotion of sports, culture, science and education, social initiatives, environmental projects Source: DSGV

6 History

7 1697 Daniel Defoe An Essay upon Projects His proposal of a pension office in every county for the reception of deposits from the poor for their relief in sickness and old age is an admirable scheme for the prevention of poverty and in some of its regulations an anticipation of the modern institution of savings banks. Memoirs of the life and times of Daniel De Foe, containing a review of his writings, and his opinions upon a variety of important matters, civil and ecclesiastical, Walter Wilson, Published by Rarebooksclub.com, United States (2013)

8 1778 First Savings Bank worldwide in Hamburg ( Ersparungsklasse der Allgemeinen Versorgungsanstalt in Hamburg Founded by the Hamburgische Gesellschaft zur Beförderung der Künste und der nützlichen Gewerbe Patriotische Gesellschaft von 1765, Patritotic Society of 1765) 1807 Reforms in Prussia (Stein-Hardenberg) Local Self-Government was established 1808 New Prussian City Law (including the right for cities to establish Sparkassen) 1850 Law with the right for counties to establish Sparkassen Most Sparkassen were established as departments of city and county administrations (100% public banks)

9 Historical background: Great Depression (3. Emergency Decree by the President) - Protection of the brand name "Sparkasse by law - Sparkassen were separated from local governments and installed as public-law institutions - Liability by the municipalities Goals: - involvement of representatives of the local economy in the management of Sparkassen, - strengthen the public confidence in Sparkassen as apolitical institutions - limit the amount of loans to municipalities (25 % of deposits) Historic Background: Great Depression (1931 Banking Crisis ) Nationalization of some big banks (e.g. Dresdner Bank, Commerzbank) Partly nationalized (Deutsche Bank) to save the bank from bankruptcy

10 Present

11 Public Mission (Mandate) German savings banks have a public mission/mandate Provide a full range of financial services nationwide Encourage citizens to save and accumulate assets Guarantee the access to a bank account to anyone Support regional economic development (SMEs, regional infrastructure) Make an active contribution to social cohesion in the local community and to sponsor cultural and educational events, sports, as well as social and environmental concerns in the interest of public welfare Strengthen or preserve competition in the banking sector

12 Public Mission (Mandate) The public mandate is regulated by law in each State s Savings Banks Act The Savings Banks public mandate is reflected in its public welfare-oriented business policy Basis: public legal form, regional principle (Savings banks focus is on doing business in the region in which they are based. Savings banks are independent credit institutions with a clearly defined business area) Co-operation within the group results in increased efficiency (economies of scale)

13 Broad Democratic Legitimacy Composition of a Sparkassen Supervisory Board (Verwaltungsrat) - 1/3 Representants of the Municipality (elected by the district council) - 1/3 informed/experienced citizens and representatives of the locals - 1/3 Employees of the Sparkasse The composition of the Supervisory Board has the guarantee that the savings banks take into account the interests of all the stakeholders when carrying out its tasks

14 Duties of the Supervisory Board: hire the board of directors (managers) determine the guidelines and objectives of the company policy supervise the management (executives) participate in the medium-term corporate planning participate in the developing of the principles of personnel policy participate in the discussion about opening and closure of branches

15 Credit Institutions in Germany 2014 Total Assets (annual average) Branches (year 2015) Sparkassen / Landesbanken ( employees) Credit Banks ( employees) Co-operative Banks ( employees) B EUR (2008: B EUR) B EUR (2008: B EUR) B EUR (2008: 915 B EUR) (6.300 Postbank) Source: Bundesbank Monatsheft 9/2014, 9/2015, Bundesbank Bankenstatistik 1/2016, Postbank Unternehmensporträt

16 Credit Institutions in Germany 2014 Deposits (July 2015) Loans (July 2015) Sparkassen / Landesbanken B EUR B EUR Kreditbanken B EUR B EUR Genossenschaften / Geno-Zentralbanken 624 B EUR 652 B EUR (Data for Non-MFIs) Source: Bundesbank Monatsbericht 9/2015

17 The Savings Banks Finance Group ensures business financing and prevents credit crunches Market Share SME-Loans in % Regional banks, other Credit Banks and other Banks Mega-Banks Co-operative Sector Savings Banks Finance Group * excluding housing construction loans to enterprises Source: Bank statistics, German Central Bank and in-house calculations Status:

18 Savings Banks : Most comprehensive Branch Network Regional density of branches: Population per branch in rural districts and not to a rural district belonging cities Population per branch... Below Savings Banks Major Banks (incl. Postbank) * incl. Postbanken Source: Acxiom, OpenStreetMap Status: 2013

19 Giving Back to the Society Sparkassen-Finance-Group Donations : 501 M EUR / year Among them Culture M EUR Social Projects M EUR Sports 90.7 M EUR Education 25.0 M EUR Environment 9.7 M EUR Others M EUR Source: DSGV

20 Profit before Taxes percent of average total assets 2 1,5 1 0,5 0-0, Sparkassen Landesbanken Regional Credit Banks Big Banks Co-operatives Source: Deutsche Bundesbank

21 Taxes Paid M Euro Sparkassen Landesbanken Regional Credit Banks Co-operatives Big Banks Source: Deutsche Bundesbank

22 Taxes Paid cumulated (M EUR) Sparkassen und Landesbanken Credit Banks Co-operatives Source: Deutsche Bundesbank, own calculations

23 Return on Equity (profit before taxes in percent of average total equity) Sparkassen Landesbanken Co-operatives Regional Credit Banks Big Banks Source: Deutsche Bundesbank

24 Cost Situation German Banking Sector Cost-Income-Ratio* 2014 Credit Banks 73.3 among them big banks 78.1 Sparkassen 68.3 (East German Sparkassen: 59,9) Co-operatives 65.9 All Banks average 69.0 *This value indicates how much euros are needed to produce 100 euros of income The lower the value, the more efficient the bank Source: Bundesbank Monatsbericht 09/2015

25 The Common Basis of the Group s Structure Ensures the Success of its Business Model The Savings Banks Finance Group Co-operation within the Group Decentralised Structure Operational Efficiency Public Legal Form Municipal Trusteeship Public Mandate Regional Principle

26 Leipziger Strasse 51 D Berlin Germany Wolfram Morales Head of the Office of the Executive President Phone: Fax:

27 Savings Banks Finance Group Key Features of Market Position The largest German banking group According to balance sheet totals, the Savings Banks Finance Group is one of the largest banking groups in Europe. Strong position in retail market The Savings Banks Finance Group is Germany s long-standing number one in credit business, deposit business and financing for SMEs - a result achieved through day-today competition. Group ratings underpin the business model The Floor-Ratings of A+ (Fitch) and A(high) (DBRS) as well as the Corporate Family Rating of Aa2 (Moody s) underpin the Savings Banks business model and risk management, as well as the consolidated group formed by independent credit institutions

28 The Savings Banks Finance Group Status: The Savings Banks Finance Group * * Not a representation of hierarchy or ownership structure Savings Banks Landesbanken Regional Building Societies Regional Public Insurance Groups Number of Institutions 417 Total Assets 1,112 Bn. Employees 244,038 Number of LB Companies 6 Total Assets** 1,113Bn. Employees ** Excluding Deka Number of Institutions 10 Total Assets 60 Bn. Employees - Internal 4,378 - External 4,374 Number 11 Gross Premium Income 19.5 Bn. Employees - Internal 18,800 - External 9,500 Equity Investment Companies DekaBank German Giro Centre Investment Companies of the Landesbanken Regional Building Society Property Companies Deutsche Leasing Other Leasing Companies Factoring Companies No. of Institutions 69 Investments 1,530 Total Vol. 1.1 Bn. Employees 246 Total Assets 116 Bn. Employees 4,035 No. of Institutions 7 Employees 250 No. of Institutions 9 Volume of Trade 5.7 Bn. Employees Internal 100 External 405 No. of Contracts 246,400 Purchase Price 27,9 Bn. Employees 2,138 No. of Institutions 4 No. of Contracts 155,600 Purchase Price 42,5 Bn. Employees 527 No. of Institutions 4 Annual Turnover 23,7 Bn. Employees 257

29 Profit before Taxes M Euro Sparkassen Landesbanken Regional Credit Banks Big Banks Co-operatives Source: Deutsche Bundesbank

30 Return on Equity (profit after taxes in percent of average total equity) Sparkassen Landesbanken Co-operatives Regional Credit Banks Big Banks Source: Deutsche Bundesbank

31 Profit after Taxes percent of average total assets 1,5 1 0,5 0-0, Sparkassen Landesbanken Regional Credit Banks Big Banks Co-operatives Source: Deutsche Bundesbank

32 Taxes Paid cumulated (M EUR) Sparkassen Landesbanken Regional Credit Banks Big Banks Co-operatives Source: Deutsche Bundesbank, own calculations

33 Jules Verne ( ) administrateur of Amiens Savings Bank honorary director