Banks in Germany has decreased further in the wake of the Corona crisis

The density of banks in Germany has decreased further in the wake of the Corona crisis and tough competition. The number of financial institutions fell last year by 38 to 1679 institutes - a decrease of 2.2 percent, as the Bundesbank announced. Of these, 26 departures are due to mergers at the cooperative banks. In addition, more than 3000 bank branches were closed. "In order for our banks to remain stable and profitable in the medium term, unpopular business decisions such as the closure of branches and the abandonment of independence will also be necessary in the future," said Bundesbank board member Joachim Wuermeling. "Banks will also increasingly have to pass negative interest rates on to customers and raise fees." Wuermeling is responsible for banking supervision on the Bundesbank's governing body. Due to the cost pressure caused by fierce competition and the ECB's penalty interest rates, as well as increasing digitalization, the banks have thinned out their branch network considerably. The number of domestic branches fell by 11.5 percent to 23,588 branches. This development was accelerated by the corona pandemic because many customers preferred to do their banking from home. The branch network of the major banks, which closed more than a quarter of their branches, shrank particularly sharply. At the end of 2020 there were still 4634 bank branches left, 1585 fewer than a year earlier. Deutsche Bank even reduced its network by 28.5 percent as part of the integration of Postbank. Commerzbank has closed more than a sixth of its branches and wants to close hundreds more branches. The savings banks, including Landesbanken, reduced the number of their branches by 679 to 8528 branches.