This paper is a draft for the chapter German banks and banking structure of theforthcoming book The German financial system. As such, the paper starts out with adescription of past and present structural features of the German banking industry. Given thepresented empirical evidence it then argues that great care has to be taken when generalisingstructural trends from one financial system to another. Whilst conventio nal commercialbanking is clearly in decline in the US, it is far from clear whether the dominance of banks inthe German financial system has been significantly eroded over the last decades. We interpretthe immense stability in intermediation ratios and financing patterns of firms between 1970and 2000 as strong evidence for our view that the way in which and the extent to whichGerman banks fulfil the central functions for the financial system are still consistent with theoverall logic of the German financial system. In spite of the current dire business environmentfor financial intermediaries we do not expect the German financial system and its bankingindustry as an integral part of this system to converge to the institutional arrangements typicalfor a market-oriented financial system.
Management of financial services: stock exchange and bank management science (including saving banks) ; Financial Markets. Other ; Individual Working Papers, Preprints ; Germany. General Resources