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Experts criticize increasing Sparkasse branch cuts


Savings banks are closing branches nationwide, dismantling ATMs and withdrawing from the area. Experts participate in an interview Report Mainz in question whether the financial institutions are still doing justice to their legal mandate.

By Judith Brosel, David Meiländer, and Philipp Reichert, SWR

Savings banks were founded in order to enable everyone to be supplied with monetary and credit services, to support regional companies and to encourage the population to save. In contrast to other banks, the focus is not on maximizing profits, but rather on strengthening the region, which is responsible for most of the savings banks.

In an interview with Report Mainz Financial experts are now questioning whether all savings banks are still living up to their public mandate, which is anchored in state savings bank laws, among other things.

Astheim in Hesse and Bliesmenge-Bolchen in Saarland – just two places in Germany where residents are currently confronted with austerity measures by the savings banks. After all, machines there still offered them the opportunity to withdraw money, make transfers or print out bank statements, but now they have to put up with significantly more distances to get to the nearest savings bank. Some miles overland – often no longer feasible for people without a car.

mining in rural areas

The plans of the savings bank in the district of Göttingen are particularly drastic. Five branches and 16 vending machine locations are to disappear there in the summer, one of them in Klein Lengden in the municipality of Gleichen. Local mayor Klaus-Werner Hanelt shows himself in an interview Report Mainz shocked: After the dismantling planned for the summer, there would only be one Sparkasse ATM for ten towns and cities in the same community – spread over an area larger than the city of Göttingen.

In Astheim in Hesse, the last ATM has been gone since the beginning of the year. There is also no supermarket where you can withdraw money while shopping in the little town with almost 3,000 inhabitants. For this reason, the mayor, according to his own statements, offered the local district savings bank Groß-Gerau to set up an ATM at the community center – free of charge, if necessary even with a subsidy.

Sparkasse rejected the offer

But the Sparkasse refused and suggested in a reply letter that Report Mainz is available, suggests that the money offered could be used for taxi vouchers to the next branch. Mayor Jochen Engel says in an interview with the ARD-Politikmagazin, he found the letter “blatant mockery”.

The Sparkasse Groß-Gerau left an inquiry Report Mainz unanswered. The head of the board of directors, Groß-Gerau District Administrator Thomas Will (SPD), said the bank offered citizens a free citizen service to bring money over. The Sparkasse Göttingen also offers this according to its own statements.

Umbrella association: “Open online branches every day”

What annoys the affected residents even more: while the local district savings bank justified the dismantling of its ATM in a letter with “economic aspects”, it announced at the same time that profits would continue to rise every year. To almost 40 million euros for 2021, last year it was around 43 million euros according to the preliminary figures.

Nationwide, the savings banks closed around 9,100 branches between 2000 and 2021; today, according to the figures from the Bundesbank, there are still 7,732. More recent figures are not available.

When asked by the nationwide Savings Banks and Giro Association why many savings banks were closing branches, the head of the communications department, Christian Achilles, evaded the matter. In an interview with Report Mainz he emphasizes several times that the savings banks are represented by the most branches of all credit institutions, “more than Aldi and Lidl together”. He goes on to say: “We are not closing, we are opening online branches every day”, there are currently 24 million in total. According to the Sparkassen-Finanzgruppe, it has a total of 50 million customers.

stocks instead of loans

Gerhard Schick from the association Bürgerbewegung Finanzwende criticized the withdrawal of the savings banks in an interview with the ARD-Politikmagazin: The savings banks only have a right to exist if they fulfill their public mandate. “And that just means being really present in the region, in the area.” You can’t “put up an ATM on every tree”. But “I think it’s one of the Sparkasse’s jobs to find a good solution with the local politicians.”

Ralf Jasny, professor of general business administration and financial services at the Frankfurt University of Applied Sciences, also takes a critical look at current developments at many savings banks with regard to their public mandate. “It’s the most comfortable path I can take as a bank manager if I just close everything that’s somehow not profitable.”

Better securities transactions than loans

Last year, Jasny also examined the annual reports of all savings banks for 2020. The finance and economics professor came to the conclusion that one in five savings banks invested more than 30 percent of their money in fixed-interest securities and shares, some even more than 50 percent – from his point of view an alarm signal. “The savings bank works like this: the saver brings money to the savings bank, the savings bank takes the money and extends it to loans again.”

However, because the lending business is “tedious and exhausting”, he believes that some savings banks are switching to investing the money in bonds and shares. From his point of view, while some savings banks fulfilled their mandate in full, around 15 percent of all savings banks were very committed to the securities business. If this investment portfolio exceeds “five or seven percent of the balance sheet total,” he considers that “very worthy of criticism.” This does not correspond to the public order.

Savings banks are often stingy when it comes to interest on deposits

And another aspect is causing experts such as Schick from the Finanzwende citizens’ movement association and customers of the savings banks to put question marks about the fulfillment of the statutory mandate. Although the European Central Bank has raised the key interest rate several times since July due to inflation, in many cases savings bank customers have not yet been able to benefit from this.

According to a current evaluation by the comparison portal Verivox, almost a third of the savings banks still paid no interest on overnight money accounts on March 21, 2023 – unlike many private banks. When asked, Achilles from the German Savings Banks and Giro Association answered in an interview Report Mainzmoney market accounts are “not a sensible investment strategy” anyway.

Initiative: enforce the common good mission more strongly

Expert Schick doubts in an interview Report Mainzwhether the common good and thus also the public mandate is fully fulfilled. “I expect the state legislators to enforce the public interest mandate more strongly at the savings banks in the sense that this is not only on top of it, but the savings bank must also be accountable for it so that the public can really perceive the difference.”

You can see this and other topics on Tuesday, March 28th at Report Mainz in the first.