A number of German banks are reviewing their activities following the announcement by DG Hyp in late December that it planned to withdraw from international markets and focus on operations at home.
A number of German banks are reviewing their activities following the announcement by DG Hyp in late December that it planned to withdraw from international markets and focus on operations at home.
According to William Newsom, UK head of valuations at adviser Savills, the German market is 'overbanked' and German lenders are going through two natural processes at the moment: mergers and capital adequacy issues relating to the Basel III banking regulations, which will require banks to hold more capital on their books. 'German banks are cautious and UK property values have proven to be quite volatile, so there may be other German banks withdrawing from UK property lending,' he noted.
DG Hyp has been one of the most active property lenders in the UK. In a report published by Savills in October, DG Hyp was cited as one of the Top 12 'most active bigger ticket lenders’ in the UK. Of the Top 12 lenders mentioned in Savills' report, nine were German lenders, including Deutsche Bank, Eurohypo, BayernLB and West Immo. DG Hyp has been involved in several big deals this year, including the refinancing of 5 Canada Square in London. It is also one of Germany's biggest issuers of Pfandbriefe, or asset-covered bonds.
The full story appears in the December 2010 edition of PropertyEU Magazine. Click on the link below to subscribe.
