German bank branches decline 6 percent; institutions consolidate

The consolidation trend in the German banking sector continued moderately in 2025.

The total number of credit institutions decreased by a net 39 (from 35 in the previous year) to 1,329 institutions, primarily due to 34 mergers.

This ongoing reduction is largely attributed to the accelerating trend of digitalization, persistent cost pressure, and evolving customer behavior, which collectively led to a streamlining of the branch network across nearly all banking segments.

The number of domestic branches fell from 17,870 to 16,799, a 6 percent decline.

This reduction was less pronounced than the 8.4 percent drop in the previous year, aligning more closely with the 5-6 percent reductions observed in 2022 and 2023.

Large banks, in particular, experienced a significant contraction in their branch networks.

The reduction in domestic branches was most pronounced among large banks, which shed 755 branches, a 34.6 percent decrease, to 1,429. This was primarily due to Deutsche Bank's network reduction of 709 branches.

Large banks now comprise only 8.5 percent of the total branch network.

Cooperative banks decreased by 27 institutions to 647, and savings banks by five to 344. While domestic consolidation continued, the number of German bank branches abroad slightly increased by six to 277, with 77 percent in Europe.

Foreign subsidiaries remained stable at 73.