The role of capital markets in Germany

The Association for Financial Markets in Europe (AFME) has published a new study on the role of capital markets in Germany. The study, which was published in collaboration with zeb, shows the potential of a stronger role of the capital markets for the financial system in Germany.

Key findings of AFME study

  • Germany is lagging behind other countries with respect to capital markets financing. 
    German companies rely almost exclusively on bank loans while households still avoid capital markets for investing and retirement provision.
  • There is an annual funding gap of EUR 175 billion needed to achieve the German government’s ambitious climate targets by 2030.
    There are increasing signs views are changing with respect to the role of the capital markets in the German financial system.
  • In Germany, the proportion of capital market instruments is significantly lower than in other countries, however, an equity culture is growing among young investors in Germany.
  • The German statutory pay-as-you-go pension system is beginning to falter in the face of an ageing society. To address this challenge, a pension scheme, partly based on capital markets funding, will be essential in the future.
  • Capital markets could help to finance future investments in Germany, including via new sources of financing, such as securitisations.


Read the report here for a full exploration of the key findings.