The state of emergency is slowly becoming the norm for Wibank.

At least that's how the Hessian Economics Minister Tarek Al-Wazir (The Greens) feels.

Because for years the minister has been predicting a normalization of the business of the Hessian development bank.

And again and again a new special situation comes up.

In 2019, the Hessenkasse debt relief program caused a spike;

In 2020 and 2021 it was the Corona aid that raised the volume of new business from the normal level, which is actually two billion euros, to more than three billion euros; in 2021 the volume was 3.4 billion euros.

Normally, says Al-Wazir, business should return to normal in 2022.

Daniel Schleidt

Coordinator of the economics department in the Rhein-Main-Zeitung.

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But the development of the year 2022 can hardly be predicted: "The pandemic is not over yet, and the war in Ukraine will have massive effects," fears the state politician, for example on supply chains, energy and raw material prices and overall economic stability.

Al-Wazir said that Wibank is already cushioning the consequences of the war on Hessian companies with liquidity aid and guarantees - for example if contractually fixed prices for orders are no longer profitable due to the sharp rise in material costs and companies get into trouble as a result.

"There aren't that many cases yet," Al-Wazir reported.

But because the minister expects more, there is a discussion about funding opportunities.

The business and infrastructure bank wants to benefit from the experience of the past few years, especially from the pandemic, where the development institute had to react quickly to new needs with new programs.

Al-Wazir said they were consulting with the federal government about what funding would be needed in view of the Ukraine crisis and which would be provided by the KfW development bank, and would then develop its own programs in a targeted manner.

Falling demand for Corona aid

So while the war has also come to the fore for the economically independent subsidiary of the Hessian Landesbank Helaba, the demand for Corona aid has recently decreased, as Michael Reckhard from the management of the institute demonstrated with the help of the "Hesse Micro-Liquidity" program.

With the help of this funding, companies with fewer than 50 employees and the self-employed can finance bottlenecks caused by Corona without involving their house bank.

According to Reckhard, 7,562 applications were processed and 221.4 million euros paid out in 2020, while in 2021 there were still 1,080 applications with a volume of 30.2 million euros - a seventh of the previous year.

Of the more than 8,000 applications, there were only 99 cases of suspected fraud, 172 companies even voluntarily paid back money they did not need,

Since the beginning of the pandemic in March 2020, a total of 1.5 billion euros have been paid out via Wibank to municipalities, companies, hospitals and educational institutions to compensate for the economic consequences of the corona virus.

That shows how important a well-functioning development bank is, said Helaba's CEO, Thomas Groß.

Tarek Al-Wazir referred to Wibank's major task of supporting companies not only in overcoming the crisis, but also in the transition to climate-friendly management and digitization.

The minister emphasized that the aim was to increasingly develop Hessen as a start-up region with a focus on green technologies.

Strong Hessian economy

After all, other non-crisis funding programs show that the Hessian economy is doing well despite Corona, said Reckhard, who perceives greater demand for start-up loans, for example.

According to Al-Wazir, this could also have something to do with the fact that Wibank has digitized many application processes in the course of the Corona aid and has also become better known.

"Many companies only realized during this time that the Wibank exists and is not only available in times of crisis."

The support of companies is just one of the Bank's business areas, the topics "supply and modernization" are more important in terms of volume," explained Wibank Managing Director Gottfried Milde.

In 2021, 814 million euros were paid out for health care, 374 million went back to compensation payments for loss of income and additional costs due to the treatment of Covid patients - around 400 million euros less than in the previous year.

In addition, more than one billion euros went to municipalities, for example for broadband expansion or flood protection projects.

In the "Construction and Housing" segment, he referred to the 70 percent increase in new business compared to the previous year, driven primarily by loans and subsidies for the construction of rental apartments.

For decades, the construction of social housing has been slowed down, said Al-Wazir.

Now it has been possible to reverse this trend for the first time in many years.