The structure of the German banking sector differs greatly from the other counties banking systems. The specifics of the former is on the one hand, the reason why German economy performed well during the crises, and on the other hand, the ground for the failure of land banks.
1.1. German banking sector
The predominant feature of the German banking system is its universality. In contrast to many other industrialized nations, there is generally no separation between commercial and investment banks. Most German banks, though they may differ in size, ownership, legal form, business structure or administrative organization, have one thing in common: they conduct all types of banking business under one roof. There is no institutional separation between lending and deposit-taking on the one side and security business in the other.
There are three types of commercial banks in Germany:
• The private commercial banks (i.e. “big three”: Deutsche Bank, Commerzbank and HypoVereinsBank , regional and other commercial...
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