The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site. Please see our Subscription Terms and Conditions.


All material subject to strictly enforced copyright laws. © 2022 Euromoney, a part of the Euromoney Institutional Investor PLC.

Falling over backwards for the Mittelstand

Eichel: Struggling to engage high
gear at Germany's jobs motor

If the role of a banking system is to finance corporates through the bad times as well as the good, the German system is failing. At least that's what the recent decision by the Federal government to establish a Mittelstand bank strongly suggests.

"Small and medium-size enterprises are Germany's job motor," said finance minister Hans Eichel in an after-dinner speech in Frankfurt at the inaugural monetary stability foundation conference in December. "We must get it into high gear."

But surveys from such institutions as the IFO and Kreditanstalt für Wiederaufbau (KfW) suggest that the Mittelstand - 98% of German corporates - is fighting to survive. KfW found that one firm in three is having trouble renewing credit lines. And the smaller the company, the harder they're finding it.

Another public bank with a social mandate So the government has taken matters into its own hands and decided to merge the SME financing activities of German development banks KfW and Deutsche Ausgleichsbank (DtA). From this month they will form a single Mittelstand bank dedicated to making it quicker and easier for small private companies to get access to funding.

You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.

SUBSCRIBE ONLINE TODAY

Unlimited access to Euromoney.com and Asiamoney.com

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually

FREE 7 DAY TRIAL

Unlimited access to Euromoney.com and Asiamoney.com, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors

LOGIN NOW

Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree