The German Bundesbank published sectoral financial accounts results for the first quarter of 2025, showing that German households’ financial wealth was largely flat as they continued to reallocate savings toward highly liquid, short-term deposits, while non-financial corporations’ external financing recovered to EUR 56 billion. Households’ financial assets edged up by EUR 9 billion to EUR 9,053 billion, as transaction-driven claims growth of EUR 90 billion was largely offset by valuation losses of EUR 82 billion, leaving net financial wealth broadly unchanged at EUR 6,913 billion. Cash and overnight deposits rose by EUR 17 billion, while savings deposits and savings certificates fell by EUR 8 billion and time deposits by EUR 7 billion, consistent with a continued shift away from longer-maturity, higher-yield deposits amid economic uncertainty and narrower yield differentials following key policy rate cuts. Households purchased EUR 1 billion of debt securities and increased holdings of equities and other shares by EUR 9 billion, including EUR 4 billion in foreign listed shares, while selling EUR 2 billion of domestic listed shares, and added EUR 28 billion in investment fund shares, including EUR 7 billion in money market funds. Real, inflation-adjusted portfolio returns declined across the wealth distribution and fell to below 1% in aggregate, with deposits still generating negative real returns, while household liabilities rose slightly to EUR 2,140 billion and the debt ratio declined by 0.2 percentage points to 49.4%. Non-financial corporations’ external financing increased by EUR 35 billion to EUR 56 billion, driven by a rise in borrowing to EUR 31 billion and net debt securities issuance of EUR 3 billion, the first positive net issuance since the second quarter of 2024, while equity issuance remained stable at EUR 10 billion. Total liabilities rose by EUR 183 billion to EUR 11,780 billion, reflecting valuation effects of EUR 128 billion largely linked to issued equity, and the debt ratio increased to 67.6%, while financial assets grew by EUR 136 billion to EUR 8,968 billion, pushing net financial wealth to minus EUR 2,812 billion. The Bundesbank noted that revisions to the financial accounts and national accounts mean the figures are not comparable with earlier press notes.
German Bundesbank 2025-07-17
German Bundesbank reports continued shift to short-term household deposits and rise in corporate external financing to EUR 56bn
The German Bundesbank's Q1 2025 sectoral financial accounts show German households' financial wealth remained stable, shifting towards liquid, short-term deposits amid economic uncertainty. Non-financial corporations' external financing rose to EUR 56 billion, driven by increased borrowing and net debt securities issuance. The Bundesbank noted recent revisions to financial and national accounts affect comparability with previous data.