Münster / Hanover (dpa / lnw) – The Landesbausparkassen West and North are about to merge. The financial institutions based in Münster and Hanover announced on Tuesday that they were examining a merger and that they had signed a letter of intent for it to lead », explained LBS-West boss Jörg Münning. His counterpart at LBS Nord, Jan Putfarken, emphasized that both building societies are economically and structurally strong and have adapted to low interest rates in recent years.
Savings phase no longer attractive for customers
The interest rate policy of the European Central Bank has been a problem for the building society industry for a long time. With classic home loan and savings contracts, there is initially a savings phase in which the customer pays money – with the prospect that the hardworking saver will be rewarded with a cheap loan after about seven to ten years. But for a long time now you can get low-interest loans even without a home loan and savings agreement. Therefore, only a few savers make use of their right to a loan under the building loan agreement. On the other hand, the demand for traditional construction financing without a previous savings phase is increasing – that is good for the coffers.
From the point of view of banking economics professor Hans-Peter Burghof from the University of Hohenheim, the merger is obvious. He told the German Press Agency that a larger institute could better shoulder the high regulatory costs incurred as a result of EU rules. Burghof sees the building societies in a difficult position – as long as interest rates do not rise, the demand for building society contracts will remain low. On the other hand, its reputation as a reliable partner in mortgage lending is positive for the industry. “When a citizen makes the biggest investment of his life, choosing a financial institution is also about trust and reliability.” Building societies could score points with consumers here.
Already extensive cooperation
LBS West and LBS Nord are no strangers to each other, because they have been working together for a long time in real estate brokerage: They merged their daughters for this business 2013.
LBS West, which is active in NRW and Bremen, has a total of 549 Full-time positions and LBS Nord 425 – their business area is Lower Saxony and Berlin. Last year, LBS West achieved new home loan and savings business of 5.3 billion euros, around one billion less than 2019. Your counterpart from Hanover came to 2.6 billion euros – also with a big minus. In the first half of the year 2021, her new business grew again, but this was also due to the corona-related lull in the same period of the previous year. LBS West did not publish any half-year figures. The lending business outside of home loan and savings contracts increased at both funds last year.
Name and location are still pending
LBS Nord merged 2001 with LBS Berlin. LBS West in turn expanded its business area 2014 through a merger with LBS Bremen. The merger that is now being targeted is not yet dry. It will probably only be carried out in the coming year or not until 2023. Negotiations are now pending between the owners – i.e. the two savings bank associations in North Rhine-Westphalia and the Lower Saxony savings bank association, Nord LB and Landesbank Berlin. It is unclear where the future headquarters will be. The name LBS NordWest suggests itself, after all, the existing real estate broker is called LBS Immobilien GmbH NordWest.
Schwäbisch Hall is the market leader in the building society sector, and number 2 is Wüstenrot. LBS Nord has a share of 33, 5 percent of new business in Lower Saxony and of 12, 7 percent in Berlin. Among the currently eight and soon possibly seven state building societies, the new LBS comes in first place according to current figures and is slightly larger than LBS Südwest. This institute has also had a merger: It was created 2016 after the merger of LBS Baden-Württemberg and LBS Rhineland-Palatinate.