The economic slump is likely to hit German banks harder than previously thought.
“Corona-related”, an additional 3,500 branches could be closed by 2025, writes “Welt am Sonntag”, referring to a study by the consulting firm Investors Marketing.
“The crisis clearly shows how vulnerable the stationary business models are,” said the head of Investors Marketing, Oliver Mihm. Institutes would find that they need fewer branches than before. According to Mihm’s forecast, the number of bank branches could drop by an average of more than eight percent per year.
Numerous customer contact points have already been closed in recent years. According to the report, there were 26,700 bank branches in Germany recently; compared to 34,000 in 2015, an annual decline of almost six percent.
However, the question arises to what extent the corona epidemic causes this process, which has been observed for a long time, or only exacerbates it. Branch extinction on the German banking market is a well-known phenomenon and continued in 2019 – before Corona.
The number of branches in Germany fell in 2019 alone by 1220 (4.4 percent) to 26,667. According to the Bundesbank, these include classic branches as well as positions with self-service terminals and additional personal advice, but not just ATMs.
The German banking industry has been suffering from fierce competition for years, and low interest rates prevent earnings. The bank density is particularly high in Germany. In addition, digitization is having a hard time with the money houses: Many customers now only do banking on the Internet instead of in person at the branch. In order to cut costs, financial houses merge and branches are dismantled.
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