Issue #17 of Net Interest, and welcome to all new subscribers. Every Friday I distil 25 years of experience looking at financial institutions into an email that explores key themes trending in the industry. If you’re reading this, but haven’t yet subscribed, join over 5,000 smart, curious people by signing up now. Thanks!

The German Bank Paradox

In a few weeks time, Germany will celebrate thirty years since reunification. One thing locals will celebrate with special fervour is their economy, whose strength is a subject of national pride. Despite the current wobbles linked to coronavirus, the German economy is the fourth largest in the world; second only to the US among bigger countries in terms of GDP per capita. As a unified country, Germany dislodged the US as the world’s biggest exporter of goods (before being overtaken by China). It weathered the Great Recession of 2007-09 better than most of its European neighbours. And its unemployment rate is one of the lowest in the Western worl…