It is also apparent that the contribution from lending business has remained largely steady. Another factor we should not overlook here, of course, is the tougher competitive environment – though I might add that rivalry has always been very intense in Germany’s banking sector. Fintechs have been disrupting the market, and incumbent credit institutions have lost pace with developments on many fronts.
Some segments of the value added chain have migrated to fintechs, eroding banks’ revenue streams in those areas. And as for tapping fresh sources of earnings such as alternative payment procedures, traditional credit institutions are already lagging behind the “new kids on the block".