Frankfurt's Financials Boom
German Banking Sector Experiences Growing Fragmentation
Riding the financial wave, German banks and savings banks notched a considerable 17% surge in interest surplus, landing a robust €104 billion in 2023. Leaving one exception, this average after-tax return on equity has hit a high of 6.1% since the 1990s, if we go by Bain & Company's findings from their latest study, 'Germany's Banks 2024'. This thorough examination dives into the fiscal fitness of 1,326 domestic financial institutions, unveiled recently.
While specifics of the average after-tax return on equity for each bank and savings bank isn't outlined in the study, it's worth noting that one standout institution, BayernLB, registered a pre-tax return on equity (RoE) of 12.7%, as per available records. The exact after-tax return for these institutions, however, necessitates knowledge of their tax rates, and in BayernLB's case, their tax expenses were €271 million, leaving us waiting for the specific net income figures.
Interestingly, BayernLB reported a profit before taxes of €1,579 million in the year following 2023. However, their 2023 profit before taxes isn't specified. Given the usual link between pre-tax and after-tax RoE, the effective tax rate plays a crucial role in determining the after-tax returns.
For the precise average return rates from Bain & Company's analysis, consult their report directly to gain comprehensive insights into the health of German banks and savings banks.
- In 2023, German banks and savings banks collectively recorded an average after-tax return on equity of 6.1%, according to Bain & Company's latest study, 'Germany's Banks 2024'.
- Despite the study not providing specific after-tax return figures for each bank, BayernLB, a notable institution, reported a pre-tax return on equity of 12.7% in 2023.
- Nonetheless, the exact after-tax return for BayernLB, as well as other institutions, needs to be calculated after considering their tax rates and tax expenses.
- To find the specific average return rates for German banks and savings banks as per Bain & Company's analysis, it's advisable to refer directly to their report for a detailed look into their financial health.
