Cover IMF Staff Country Reports
Germany: Financial Sector Assessment Program-Technical Note-The Determinants of Bank Profitability
Author:
International Monetary Fund. Monetary and Capital Markets Department
Search for other papers by International Monetary Fund. Monetary and Capital Markets Department in
Current site
Google Scholar
PubMedClose
Series:
IMF Staff Country Reports
Volume/Issue:
Volume 2022: Issue 273
Language:
English
Publication Date:
16 Aug 2022
DOI:
https://doi.org/10.5089/9798400218118.002
ISBN:
9798400218118
ISSN:
1934-7685
Pages:
46
Keywords:
Germany FSAP; asset productivity; commission income; income component; FSAP's finding; net fee; Cooperative banks; Commercial banks; Bank soundness; Loans; Income; Europe; Global
Download PDF (2.3 MB) Download Epub
German bank profitability is low by international standards. Although German banks rank more favorably in risk-adjusted terms, as low profitability is partially compensated by lower volatility of returns, their profitability ratios remain low. On other measures (such as returns on assets, equity, and risk-weighted assets), German banks, on aggregate, rank among the least profitable in Europe. Several factors affect bank profitability, including a complex tiered industry structure with barriers to entry and an explicit mandate of a large part of the banking system – cooperative and savings banks – to maximize welfare of stakeholders rather than profits.
  • Collapse
  • Expand
Cover IMF Staff Country Reports
IMF Staff Country Reports
ISSN:
1934-7685
Publisher:
International Monetary Fund
Volume 2022: Issue 273