How difficult to finance through loans is now really?
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The Chief Economist of KfW, Norbert deer, gave recently to an in-house information service of the Loan an interesting interview that we want to share with you. Deer speaks it clear over the current credit conditions and the opinion of the banks, there would be no credit crunch in our country.
” KfW chief economist – growth rates for new loans have declined dramatically
Deer on credit crunch and KfW Special Program
“Companies are desperately looking for loans “Headlines such as these dominate the media. KfW chief economist Norbert deer believes the company will continue to have a hard time, business and investment plan to finance their ongoing.
Mr Deer, KfW has launched a special program with a volume of 40 billion euros in order to facilitate companies to finance their investment and the purchase of raw materials and equipment. At the same time doubt large organizations such as the DIHK, savings banks and cooperative banks that there are problems at all in the refinancing business. Does not the credit crunch?
Deer: Our investigations in recent years have shown that medium-sized enterprises and especially small companies have specific structural funding problems. The quarterly banking survey by the Federal Bank show that in the course of 2008, the funding situation is considerably more difficult for all companies. The banks have increased the risk margin and stricter requirements for the award significantly.
Why then deny some banks, the credit crunch?
Deer: Because the “credit crunch” something else understand. There is no widespread terminal in the sense that financially decent company generally a debt investment is rejected. This is also our most recent snap poll: A typical member companies of the respective polled Association currently has therefore no fundamental problems to get an investment loan. From a general credit crunch can not therefore be the question. However, there are probably significantly worse financing conditions, investment expensive, some companies are too expensive to make. But it should not completely disregard also that the economic reasons much worse sales expectations to a massive decline in investment and thus the demand for loans lead. That is, if a falling aggregate lending activity is mainly caused by falling demand, then there are obviously no credit crunch. It is important at this stage that companies ready to invest, are also on the necessary credit facilities approaching those.
Is there evidence that there is a real nationwide credit crunch?
Deer: there are signs indeed. Since there are no reliable statistics on the new loans, we charge them in our quarterly credit market outlook. The growth rates of Kreditneuvergabe to enterprises and self are about almost a year since declined sharply. In the fourth quarter of 2008 increased the volume neuvergebener loans over the previous year is still some five percent and this rate of change in trend is likely to decrease even further. If at the same time tighten the credit demands of businesses from banks – such as credit institutions in the latest survey expect the Bundesbank itself – it would be a scenario where a credit crunch. It should be a credit crunch but not hastily call, the forecast uncertainty is very high.
Which companies and industries have special problems?
Deer: especially the export-oriented industries such as automotive, shipbuilding, chemical and mechanical engineering suffer from weak sales and financing problems. In this case, the large companies the most difficulty in loans included because they depend on the strengthened export.
Why are the banks reluctant to credit and reduce the current account, despite the fact that the middle class in recent years very well deserved and improving its equity capital has strong? The risks are manageable but …
Deer: The banks are generally risk averse and more cautious, that is, given the current financial market situation and the economic outlook, no wonder. In addition, the equity of the banks because of the already made and anticipated depreciation claimed strong, so that the possibility of lending has decreased. In particular, large projects are likely to have hard to find in such an environment funding. Here indeed put on the protective umbrella of the Federal Government and the KfW special program of specific liability exemptions. The special feature of the program is indeed the indemnity of up to 90%.
This means that the risk of loans that are not repaid, with essentially the KfW and the federal government. That ought to help the battered auto industry in particular?
Deer: This helps all sectors with funding problems, but of course especially to those who have the greatest difficulty, that the automobile industry, chemistry and mechanical engineering.
Which investment will cause the program?
Deer: We expect that with the investment program in a volume of supporting up to 53 billion euros. This will make a significant contribution to safeguarding jobs.
In which sectors?
Deer: The KfW is based on the normal distribution industry. A focus should lie with the manufacturing sector. It could also be that the export-oriented industries will be better represented.
Especially large companies complain of poorer credit conditions …
Deer: … exactly, and why the federal government has increased the KfW special program with the second economic stimulus program from 15 to EUR 40 billion and opened for major companies and corporations. It concerns us all, to secure or create jobs. Since we want the flexibility to decide, in close coordination with the federal government. ”
The Chief Economist of KfW, Norbert deer, gave recently to an in-house information service of the Loan an interesting interview that we want to share with you. Deer speaks it clear over the current credit conditions and the opinion of the banks, there would be no credit crunch in our country.
” KfW chief economist – growth rates for new loans have declined dramatically
Deer on credit crunch and KfW Special Program
“Companies are desperately looking for loans “Headlines such as these dominate the media. KfW chief economist Norbert deer believes the company will continue to have a hard time, business and investment plan to finance their ongoing.
Mr Deer, KfW has launched a special program with a volume of 40 billion euros in order to facilitate companies to finance their investment and the purchase of raw materials and equipment. At the same time doubt large organizations such as the DIHK, savings banks and cooperative banks that there are problems at all in the refinancing business. Does not the credit crunch?
Deer: Our investigations in recent years have shown that medium-sized enterprises and especially small companies have specific structural funding problems. The quarterly banking survey by the Federal Bank show that in the course of 2008, the funding situation is considerably more difficult for all companies. The banks have increased the risk margin and stricter requirements for the award significantly.
Why then deny some banks, the credit crunch?
Deer: Because the “credit crunch” something else understand. There is no widespread terminal in the sense that financially decent company generally a debt investment is rejected. This is also our most recent snap poll: A typical member companies of the respective polled Association currently has therefore no fundamental problems to get an investment loan. From a general credit crunch can not therefore be the question. However, there are probably significantly worse financing conditions, investment expensive, some companies are too expensive to make. But it should not completely disregard also that the economic reasons much worse sales expectations to a massive decline in investment and thus the demand for loans lead. That is, if a falling aggregate lending activity is mainly caused by falling demand, then there are obviously no credit crunch. It is important at this stage that companies ready to invest, are also on the necessary credit facilities approaching those.
Is there evidence that there is a real nationwide credit crunch?
Deer: there are signs indeed. Since there are no reliable statistics on the new loans, we charge them in our quarterly credit market outlook. The growth rates of Kreditneuvergabe to enterprises and self are about almost a year since declined sharply. In the fourth quarter of 2008 increased the volume neuvergebener loans over the previous year is still some five percent and this rate of change in trend is likely to decrease even further. If at the same time tighten the credit demands of businesses from banks – such as credit institutions in the latest survey expect the Bundesbank itself – it would be a scenario where a credit crunch. It should be a credit crunch but not hastily call, the forecast uncertainty is very high.
Which companies and industries have special problems?
Deer: especially the export-oriented industries such as automotive, shipbuilding, chemical and mechanical engineering suffer from weak sales and financing problems. In this case, the large companies the most difficulty in loans included because they depend on the strengthened export.
Why are the banks reluctant to credit and reduce the current account, despite the fact that the middle class in recent years very well deserved and improving its equity capital has strong? The risks are manageable but …
Deer: The banks are generally risk averse and more cautious, that is, given the current financial market situation and the economic outlook, no wonder. In addition, the equity of the banks because of the already made and anticipated depreciation claimed strong, so that the possibility of lending has decreased. In particular, large projects are likely to have hard to find in such an environment funding. Here indeed put on the protective umbrella of the Federal Government and the KfW special program of specific liability exemptions. The special feature of the program is indeed the indemnity of up to 90%.
This means that the risk of loans that are not repaid, with essentially the KfW and the federal government. That ought to help the battered auto industry in particular?
Deer: This helps all sectors with funding problems, but of course especially to those who have the greatest difficulty, that the automobile industry, chemistry and mechanical engineering.
Which investment will cause the program?
Deer: We expect that with the investment program in a volume of supporting up to 53 billion euros. This will make a significant contribution to safeguarding jobs.
In which sectors?
Deer: The KfW is based on the normal distribution industry. A focus should lie with the manufacturing sector. It could also be that the export-oriented industries will be better represented.
Especially large companies complain of poorer credit conditions …
Deer: … exactly, and why the federal government has increased the KfW special program with the second economic stimulus program from 15 to EUR 40 billion and opened for major companies and corporations. It concerns us all, to secure or create jobs. Since we want the flexibility to decide, in close coordination with the federal government. “
