Companies at a loss about financing
There's not a lot new about the fact that German corporates need to think about reassessing their funding mix, but a new survey by Siemens Financial Services suggests that their best ideas about how to go about this are not good enough.
The survey compares the experiences of 500 large Mittelstand companies and SMEs in Germany, France, the UK and US with an annual turnover of more than e50 million, the sort of companies that, in theory, should have all types of financing available to them.
The study reveals that two-thirds of the German finance directors surveyed plan to tap new financing resources in the coming year, far more than their counterparts in the US or UK. Yet two-thirds also think that corporate financing will become more difficult over the coming year. In particular, some 64% of the smallest German companies surveyed expect to face problems compared with just 18% in the UK.
More worryingly, the funding solutions they come up with are inadequate to address their needs. German companies seem to have lost faith in the ability of capital markets to solve their problems, despite last year's survey predictions of an increase in the use of bonds and receivables securitizations.