The Payout Behaviour of German Savings Banks

Market discipline at German savings banks

Several theoretical studies suggest that only uninsured depositors have an incentive to discipline their banks, i. e. react with changes in deposit volumes or in required interest rates as a reaction to changes in banks’ risk. This paper empirically investigates whether German savings banks are disciplined by their depositors although these should be regarded as fully insured due to public guar...

Does capital regulation matter for bank behaviour? Evidence for German savings banks

The aim of this paper is to assess how German savings banks adjust capital and risk under capital regulation. We estimate a modified version of the model developed by Shrieves and Dahl (1992). This paper contributes to the literature in three ways. First, we test the capital buffer theory (Marcus 1984, Milne and Whalley 2002). Second, we use dynamic panel data techniques that explicitly take un...

How Politics in uence State-owned Banks - the Case of German Savings Banks

This paper is one of the rst to analyse political in uence on state-owned savings banks in a developed country with an established nancial market: Germany. Combining a large dataset with nancial and operating gures of all 457 German savings banks from 1994 to 2006 and information on over 1,250 local elections during this period we investigate the change in business behavior around elections. We...

Clustering or competition? The foreign investment behaviour of German banks

The presence of other firms in a foreign market can have a double-edged effect on the profitability of new entrants. Firstly, a larger presence of other firms implies more competition and thus lowers the earnings prospects of new entrants. Secondly, there might be positive spill-over effects between the activities of new and old entrants, which can lead to clustering effects. Such clustering of...

Sustainable investments and strategies for the proprietary trading of German savings banks