German public-sector banks Helaba and Deka to consider merging

Credit: REUTERS/CHRIS HELGREN

German public-sector banks Helaba and Deka will consider a merger, a spokeswoman for Germany's savings banks association said on Tuesday, in a sign of consolidation of the country's fragmented banking sector.

FRANKFURT, Oct 8 (Reuters) - German public-sector banks Helaba and Deka will consider a merger, a spokeswoman for Germany's savings banks association said on Tuesday, in a sign of consolidation of the country's fragmented banking sector.

The spokeswoman said that the majority owners of both Frankfurt-based banks decided that the lenders would enter talks "with a view to examining closer cooperation, up to and including a merger".

The plans, which could lead to creation of Germany's biggest public-sector bank based on assets, come at a time when banks are facing pressure to consolidate because low interest rates and competition from listed or cooperative banks as well as online start-ups are squeezing their margins.

The decision follows a meeting of savings banks officials on Tuesday. Earlier this year, sources told Reuters that the banks were considering a tie-up.

Business daily Boersen-Zeitung first reported on the plans on Tuesday.

Helaba is one of Germany's landesbanks, which are traditionally owned by savings banks and regional states.

Deka is owned by 12 regional savings banks and serves as an asset manager for all of Germany's savings banks.

Germany's savings banks umbrella organisation, DSGV, has pushed for mergers and its president, Helmut Schleweis, last year floated the idea of creating a so-called super-landesbank, or a central bank for the savings banks.

A spokesman for Deka declined to elaborate. Helaba did not immediately respond to requests for comment.

(Reporting by Hans Seidenstuecker; Additional reporting by Arno Schuetze; Writing by Tom Sims; Editing by Steve Orlofsky)

((Tom.Sims@thomsonreuters.com; +49 69 7565 1242; Reuters Messaging: tom.sims.thomsonreuters.com@thomsonreuters.net))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Reuters

Reuters, the news and media division of Thomson Reuters, is the world’s largest international multimedia news provider reaching more than one billion people every day. Reuters provides trusted business, financial, national, and international news to professionals via Thomson Reuters desktops, the world's media organizations, and directly to consumers at Reuters.com and via Reuters TV.

Learn More