The savings banks are warning of the devastating consequences that the sharply rising prices are already having in Germany.

With the current price jumps, especially for energy and food, 60 percent of private households need their entire monthly income and more to cover current expenses, said Helmut Schleweis, President of the German Savings Banks and Giro Association on Tuesday at a press conference.

According to calculations by the savings banks, households with a monthly net income of less than 3,600 euros would currently have no money left at the end of the month and would then have to partially close the gaps with their own savings.

Tim Kanning

Editor in Business.

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The Savings Bank President therefore appealed to the Federal Government to give particular consideration to these income groups in the planned relief packages.

Households in particular, which have hitherto been able to make ends meet on their own income, now urgently need to invest in more energy efficiency and the like.

In addition, changing consumer behavior by private individuals is likely to have an increasing impact on sectors of the economy such as gastronomy, retail and many services.

Company on the verge of breaking point

The press conference, for which the savings banks evaluated the situation of their 300,000 corporate customers, focused on the consequences of the sharp rise in energy prices, particularly for small and medium-sized enterprises.

Schleweis' conclusion: “All German companies are now affected by massive increases in energy prices.

For energy-intensive companies in particular, this means a massive increase in production costs that often cannot be managed on their own.” The sharp rise in prices for gas and electricity is also pushing companies that are in a rock-solid position to their breaking point.

"If we want to face the economic threat from Russia together, then these companies need help." In his view, the most effective means is now a clear limitation of energy prices

Scarce raw materials and the uncertain energy supply have hitherto been a particular burden on the chemical industry, mechanical engineering, the construction industry and the automotive industry.

However, high inflation is also likely to lead to changes in consumer behavior in private households.

One industry is particularly suffering from rising interest rates

Schleweis emphasized that despite everything, he sees medium-sized companies in a good position because of their fundamentally good equity base of 40 percent and that the savings banks want to continue to support companies with loans.

In the first half of the year alone, the savings banks had committed EUR 60 billion in new corporate loans, which was an increase of 19 percent.

How the number of insolvencies will develop and thus also the number of loans at risk of default is naturally difficult to predict.

"The balance sheets only offer a look in the rear-view mirror," said Schleweis.

According to Schleweis, the rising interest rates of the European Central Bank do not yet pose a major threat to most companies. “After all, over 80 percent of savings bank loans to companies and the self-employed are long-term loans with a term of more than five years.” For individual sectors, For example, the capital-intensive real estate industry, the rising interest rates are definitely a "serious challenge".