Munich Financial Center: Top in Finance! - Invest in Bavaria

Munich Financial Center: Top in Finance!

Munich Financial Center Initiative 

Contents 

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Editorial 

The Financial Center at a Glance 

History of the Financial Center 

Insurance 

Banking 

Asset Management 

Stock Exchange 

Private Equity and Venture Capital 

Leasing and Factoring 

Institutions 

Research and Education 

Location 

Expatriates / Human Resources 

Members of the Initiative / Contact 

List of Illustrations 

Editorial: 

Munich Financial Center – 

Champion of the Bavarian Economy 

Bavaria’s economic and innovative power and top-level research are recognized around the 

world. The fact that Bavaria is also “Top in Finance” is, regrettably, not as widely known. 

That is unfortunate. Bavaria is now one of the most important financial centers in Europe 

because of the high quality and wide range of companies that it offers in the areas of asset 

management, banking, insurance, leasing, equity funds and venture capital. Munich is the 

No. 1 insurance center in Germany, the No. 2 banking center, the No. 1 asset management 

center and the top private equity, venture capital and leasing center in Germany, and it also 

has an important stock exchange. 

Because of ever fiercer competition, it is important for Bavaria to continue to consolidate 

its position as a top international financial center. That is the reason why the Bavarian 

ministry of economic affairs initiated the Munich Financial Center Initiative, in which 

prominent representatives from financial services, insurance companies, venture capital 

and leasing companies, the Bayerische Börse AG, chambers of commerce, trade associations 

and the field of science are taking part. In addition, we have gathered expertise from all 

of the major players in the financial services sector as part of the “cluster” initiative of the 

Bavarian government. The goal is to get the Bavarian financial services sector to work more 

closely with science. 

In this brochure, you will find out more about one of the most important financial 

centers in Europe, its businesses, institutions and special environment. 

Erwin Huber 

Bavarian Minister of Economics, Infrastructure, Commerce and Technology


The Financial Center at a Glance: Top in Finance! 

Bavaria and the Munich metropolitan area 

in particular rank among Europe’s leading 

financial centers. This holds true for all 

branches of finance – for the traditional 

banking and insurance sectors, as well as 

asset management activities, venture capital 

solutions, and leasing and factoring trades. 

In addition, the Munich financial center is 

extremely well positioned in this industry, 

with offerings that are both broad-based 

and at the cutting-edge. This is demonstra- 

ted by the fact that many prominent busi- 

nesses in the financial sector have 

their head offices in Munich and Bavaria. 

Among the most widely known are the 

Allianz and Munich Re insurance groups, 

the Nuremberg insurance groups, HUK- 

Coburg, HypoVereinsbank and BayernLB. 

They all represent an economic sector that 

is one of the leading drivers of growth in 

Bavaria – and will actively represent the 

Munich Financial Center Initiative abroad. 

For that purpose, major companies, organi- 

zations and institutions have joined together 

to promote the importance of the financial 

center and draw attention to its views and 

recommendations. 

Insurance: A global leader 

Banking: One of the most important banking centers 

Asset Management: A leader in Europe 

Stock Exchange: One of Europe’s most 

innovative stock exchanges 

Venture Capital / Private Equity: No. 1 in Germany 

Leasing: The leading leasing center in Germany 

4 5


History: Dynamic for Hundreds of Years 

Munich has had an exceptionally successful history as a financial center. Throughout its 

history and up to the present it has been characterized by dynamism, know-how and 

entrepreneurial boldness. 

Milestones 

1486 The Fugger Brothers trading house in Augsburg was designated for the first time 

as a bank. It developed into today’s private bank, Fürst Fugger. 

1774 Founding of Fürstlich Castell’schen Bank, Credit-Casse, in Castell. 

1821 The first Bavarian savings bank was opened in Nuremberg. 

1830 Opening of the Munich stock exchange. 

1835 Founding of Bayerischen Hypotheken- und Wechsel-Bank AG (Hypo-Bank). 

1864 Hypo-Bank introduces mortgage bonds. 

1869 Founding of Bayerische Vereinsbank AG. 

1880 Founding of Munich Re. 

1889 Carl v. Thieme and Wilhelm v. Finck, the co-founders of Munich Re, 

found Allianz Versicherungs-AG. 

1911 Founding of Bayerische Rückversicherung AG. 

1916 Hypo-Bank is now the largest mortgage bank in Germany. 

1924 Swiss Re acquires Bayerische Rückversicherung AG 

(since 2001 Swiss Re Germany AG). 

1941 D.A.S. moves its headquarters from Berlin to Munich. 

1949 Relocation of Allianz Versicherungs-AG’s head office from Berlin to Munich. 

1949 Founding of first German mutual fund, ADIG-Investment. 

1958 Hypo-Bank and Bayerische Vereinsbank found Internationale Immobilien-Institut 

GmbH (iii-investments). It is the first investment company for open real 

estate funds in Germany. 

1971 Nürnberger Versicherungsgruppe introduces variable life insurance and helps it 

become popular throughout Germany. 

1975 Noris Verbraucherbank, Nuremberg, is the first German financial institution to 

introduce customer self-service. 

1994 ADIG opens the first German money market fund. 

1994 Hypo-Bank founds Direktanlage-Bank, the first German discount broker. 

1997 Munich Re combines a major portion of its direct insurance activities under the 

umbrella of ERGO Versicherungsgruppe AG. 

1998 Merger of Hypo-Bank and Bayerische Vereinsbank into Bayerische Hypo- and 

Vereinsbank AG (HVB), thus creating Germany’s second largest bank. 

2000 Indexchange AG is the first company to issue exchange-traded funds (ETFs) 

in Germany on the DAX and on the Dow Jones Index. 

2001 Allianz acquires Dresdner Bank. 

2001 Founding of the Financial Center Munich Initiative. 

2005 The HVB merges with the Italian UniCredit to form the fifth largest European bank. 

6 7


Insurance: A Global Leader 

Munich is one of the leading insurance cen- 

ters worldwide. About 80 insurance compa- 

nies have their headquarters in the Bavarian 

state capital and its surrounding towns – 

among them one of the most important di- 

rect insurers worldwide, the Allianz Group; 

the world‘s largest re-insurance company, 

Munich Re; Europe‘s leading legal expenses 

insurer, D.A.S.; Germany‘s most important 

insurance group under public law, Versiche- 

rungskammer Bayern (Bavarian Insurance 

Chamber); as well as the largest group of 

professional pension plans in Germany, 

Bayerische Versorgungskammer (Bavarian 

Pension Chamber). 

In addition to the insurance groups domi- 

ciled in Munich, numerous other foreign 

and domestic insurers maintain principal 

offices in the metropolis on the Isar, among 

them Swiss Re, one of the world’s leading 

reinsurers. The insurance industry employs 

around 29,000 people in Munich alone, 

more than in any other German city. 

Across Bavaria, about 65,000 people work 

for insurance companies. Of that number, 

more than 12,000 work in the two additional 

major Bavarian insurance locations – 

Nuremberg and Coburg. Along with HUK- 

Coburg, one of the most important German 

automotive insurers, and the Nürnberger 

Versicherungsgruppe – among other things, 

in second place among occupational disa- 

bility insurers – additional leading German 

insurance companies are domiciled in 

these cities. 

The Munich and Bavarian 

Insurance Center 

in Figures* 

Munich 

Employees: 29,000 

Insurance companies domiciled 

in Munich (and region): 80 

Bavaria 

Employees: 65,000 

Insurance companies 

domiciled in Bavaria: 110 

The Largest Insurers 

at a Glance* 

Allianz 

Employees worldwide: 162,000 

Turnover 2004: 96.9 bn. euros 

Münchener Rück 


Gross premiums: 38.1 bn. euros 

D.A.S. 


Premium incomes: 1.16 bn. euros 

Nürnberger Versicherungsgruppe 



HUK-Coburg 



*rounded data from 2004 

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Banking: A Leader in the Sector The Bavarian Banking Center at a Glance* 

Bavaria plays a central role in German 

banking. Overall, the banks domiciled here 

have lent funds totaling about 730 billion 

euros to business and consumers. That‘s 

more than 15 percent of the total lending 

volume of German banks. Munich banks 

alone represent one-tenth of the entire busi- 

ness volume of the German credit services 

industry. That makes the Bavarian state 

capital the second most important banking 

center in the Federal Republic. Overall, 

about 50 banks are headquartered here – 

including two of Germany‘s largest banks, 

Bayerische Hypo- und Vereinsbank AG 

(HVB), which in 2005 merged with the Ita- 

lian UniCredit to form the first truly Euro- 

pean bank, and Bayerische Landesbank. In 

fact, about 160 banks, including numerous 

foreign banks, are present in Munich. This 

underscores the international significance 

of the financial center. 

Bavaria itself is the home market for around 

530 banks, including more than 80 savings 

banks and just under 370 cooperative 

banks. This means well over 20 percent of 

all German banks are based in Bavaria – 

substantially more banks than in any other 

federal state, and even more than in the 

banking country, Switzerland. The banks 

employ approximately 126,000 people. 

Traditionally, Bavarian banks play a major 

role in the mortgage business. For example, 

Munich banks issued around one-third of 

all mortgage bonds floated in Germany. 

Number of financial institutions: 530 

private banks: 80 

savings banks: 80 

credit unions: 370 

Employees: 126.000 

private banks: 32,000 

saving banks: 58,000 

credit unions: 36,000 

Total assets: 984 bn. euros 

Total loan volume: 730 bn. euros 

* rounded data from 2004 

10 11


Asset Management: Value and Innovations 

In 1949, ADIG launched the first German 

fund company ever in the Bavarian state 

capital. Today, asset management compa- 

nies held by Munich companies manage 

about 1,500 billion euros, one of the highest 

values worldwide. 

Among other factors, the high level is attri- 

butable to the innovative skills of Bavarian 

asset management companies. They have 

been successful in rapidly recognizing and 

creating trends, and in developing new pro- 

ducts as needed that set the standards. 

Accordingly, the first open real estate fund 

and the first money market funds, for ex- 

ample, originated in Munich. And more 

recently, Munich companies helped ex- 

change traded funds and total return bond 

funds break through in Germany. In additi- 

on, the industry is very actively pushing the 

introduction of REITs (Real Estate Invest- 

ment Trusts). 

The high quality of the assets managers 

working in the Munich financial center is 

shown, among other things, in the fact that 

many of the funds managed by Bavarian 

companies distinguish themselves in the 

pertinent performance ratings. As a result, 

they are trusted by private and institutional 

investors from unrelated sectors and even 

finance companies. 

The financial center also has major importance 

for closed funds – some of Germany‘s 

largest initiators of this industry are at 

home here. 

Munich’s Innovations in Asset Management 

First German investment company 

First mutual fund in Germany 

First German investment fund 

First German money market fund 

First exchange traded funds on the DAX 

Pioneer in total return bond funds 

12 13


Stock Exchange: Success with Innovations 

The Munich Stock Exchange provides an 

ideal combination of the traditional and the 

modern. Germany‘s third-largest exchange, 

founded as early as 1830, has developed 

into one of Europe‘s most innovative secu- 

rities trading centers. Among other things, 

this is evident in the new SME segment, 

M:access, as well as Max-One, the trading 

system developed by the Munich Stock 

Exchange and introduced in 2003. This sys- 

tem guarantees the exchange will transact 

an order immediately and completely at the 

best price - and thus considers the needs of 

private investors in particular in a unique 

manner. This service is one of the reasons 

why the Munich Stock Exchange has re- 

cently been able to significantly expand its 

market share. 

Munich Stock Exchange in Figures* 

Number of tradable securities: 4,300 

number of domestic securities: 700 

Listed on the Munich Stock Exchange 

are a total of 2,700 German securities and 

government bonds, as well as 3,600 in- 

ternational securities from more than 60 

countries. The advantages of Max-One 

are particularly evident when dealing with 

international securities. Also in this re- 

spect, the Munich Stock Exchange offers its 

clients a uniquely high-quality performance. 

Munich and its environs are also the head- 

quarters of several securities trading firms, 

among them Baader Wertpapierhandels- 

bank and MWB Wertpapierhandelshaus. 

These are among the leading securities 

trading banks in the Federal Republic and 

are some of the institutions that guarantee 

the advantages of Max-One. 

number of foreign securities from more than 60 countries: 3,600 

Number of tradable government bonds: 2,000 

Total revenue in 2005 in bn. euros: 15.4 

securities: 3.7 

bonds: 11.7 

* rounded data from 2005 

15


Private Equity and Venture Capital: 

The Most Popular Venture Capital Center 

Bavaria is the most important German 

federal state for the venture capital and 

private equity industry. Around 50 VC and 

private equity companies have their head- 

quarters in Munich. Furthermore, many 

other German and international compa- 

nies in this sector have major offices in the 

Bavarian capital city. The very high number 

of venture capital companies is primarily 

attributable to the fact that they find an 

ideal environment in Munich and Bavaria. 

After all, Bavaria is one of the most impor- 

tant regions in the world in the fields of IT, 

medicine and biotechnology, and has an 

especially strong service sector at its dispo- 

sal. That is why venture capital and private 

equity companies in Bavaria particularly 

have so many investment opportunities 

in industries that traditionally attract a lot 

venture capital and private equity money. 

In 2004, the risk capital issuers placed 

about 760 million euros in Bavaria. That is 

the highest annual amount they have ever 

invested in a single German federal state. 

Leasing and Factoring: The Market Leader 

The Munich metropolitan area is 

Germany‘s leading region for leasing. Of 

the approximately 430 „major“ leasing 

companies in Germany with equity capital 

of at least 250,000 euros, just under 120 are 

located in and around Munich, and 48 of 

those are headquartered here. 

The three most important of them alone – 

Kommanditgesellschaft Allgemeine 

Leasing (KGAL), LHI Leasing and Han- 

nover Leasing – together administer a total 

investment volume of approximately 66 

billion euros. In addition, they are among 

the top German issuers of closed funds and 

are consequently based in the most impor- 

tant market for these financial products 

in Germany. 

The Munich metropolitan area is also 

among the leading factoring locations in 

Germany. Two reasons for this are Eurofactor 

AG, the market leader for import 

factoring in Germany, and Siemens Financial 

Services, the fastest growing German 

factoring supplier overall in 2004. 

16 17


Institutions: Support for the Economy 

Bavaria has developed from an agricultural 

state to a high-tech and service provider 

location in just a few decades, thanks to the 

strong performance and innovativeness 

of the companies located here. Essential 

support came from the Bavarian state 

government and local authorities, as well as 

regional and local institutions, trade asso- 

ciations and chambers of commerce. 

The Bavarian state government created re- 

liable and business-friendly conditions and 

thereby laid the essential political founda- 

tion so Bavaria could develop into one of 

the premier business locations in Europe. 

Similarly, public institutions like the eco- 

nomic and employment departments of the 

cities and communities as well as “Invest 

in Bavaria”, the settlement and location 

marketing initiative of the Bavarian ministry 

of economic affairs, essentially contribute 

to the fact that a particularly business- and 

innovation-friendly climate can prevail 

18 

in Bavaria. The same holds true for the 

banking associations, trade associations 

and chambers of commerce, for example 

the Chambers of Commerce and Industry 

(IHK), and local chambers of crafts. They 

provide streamlined help to investors and 

local companies – and thereby strengthen 

the financial center as well.


Research and Education: The Knowledge Cluster 

Bavaria ranks among the most important 

educational and research locations 

in the world: 

– with about 50 public and private universi- 

ties, colleges and art schools. Approximate- 

ly 250,000 students are registered at them, 

and around 41,000 of those have chosen 

economic studies. 

– with the headquarters of the Max Planck 

Society and the Fraunhofer Society, two of 

the most famous research organizations in 

Germany. The Max-Planck Society ope- 

rates 12 research institutes in Bavaria, the 

Fraunhofer Society runs eight. 

– and with many other research facilities, 

including, for example, the Ifo Institute for 

Economic Research. 

The Bavarian government actively pro- 

motes closer cooperation between science 

and the economy. This enables it to link 

theory and practice, and ensures intensive 

collaboration among Bavarian universities, 

especially among their business and finance 

departments. Included in these “cluster 

policies” are the further development of 

educational opportunities and the optimi- 

zation of research and academic education, 

for example through the earliest possible 

exploration of trend-setting topics, as well 

as through greater incentives for product 

innovation and internationalization. All of 

this serves to further strengthen the interna- 

tional competitive position of the financial 

center. 

Overview the Business and Finance 

Departments in Bavaria 

20 21 

Coburg 

Hof 

Aschaffenburg 

Bayreuth 

Bamberg 

Würzburg Weiden 

Neu-Ulm 

Ansbach 

Kempten 

Nuremberg 

Eichstätt 

Augsburg 

Ingolstadt 

Freising 

Munich 

Regensburg 

Erding 

Neubiberg 

Landshut 

Rosenheim 

Deggendorf 

Passau


Location: A Leader in the Heart of Europe 

Munich and Bavaria have one thing in parti- 

cular in common: They surpass by many 

market indicators and studies other Ger- 

man cities and states. 

City ranking: Munich has the strongest 

economy of all large German cities. 

Outlook for Growth and Prosperity: Mu- 

nich is the German city with the best pros- 

pects for growth and affluence. 

Employment: The number of employees 

covered by social insurance in Bavaria has 

increased by almost a quarter in the last 30 

years – almost four times as much as the 

west German average. 

Top Companies: Approximately 90 of the 

1,000 largest German companies have their 

headquarters in Munich. In this area, Mu- 

nich is ahead of every other German city by 

a large margin. Augsburg and Nuremberg 

are each home to 15 large corporations. 

That also puts them in the forefront when 

compared to other cities, and emphasizes 

the economic importance of Bavaria. 

Market Capitalization: Measured by market 

capitalization, Munich is the most impor- 

tant city for stock exchanges in Germany. 

Nowhere else has as many Blue Chip, 

as well as mid- and small-cap, companies 

as here. 

Patents Registrations: Bavarian companies 

and researchers apply annually for more 

than a quarter of all German patents – 

a very high number in comparison with 

other German states. 

Bavaria’s Economy in Figures* 

Economic growth: +1.6% 

GDP (real): 403.7 bn. euros 

GDP per resident: 32,408 euros 

GDP per gainfully employed person: 63,512 euros 

Exports: 126.5 bn. euros 

Export growth: 7.2% 

Total gainfully employed persons: 6.4 mio. 

Employed social insurance contributors: 4.3 mio. 

Percentage of self-employed persons: 11.9% ** 

* data for 2005 

** data for 2004 

22 23


Expatriates: 

Quality attracts Quality – 

Welcome to Bavaria 

For top executives, leading companies are 

the preferred addresses. It’s more fun, after 

all, to work for the best of the best – such 

as the top-notch companies, as well as the 

research and educational organizations, in 

Bavaria. In Munich alone, seven of the 30 

DAX companies have their headquarters. 

They all rank among the global market lea- 

ders in their industries. In no other German 

city are workers as highly qualified as 

in Munich. 

Many “high potentials”, especially those 

from abroad, come to work in Bavaria 

because the entire environment is attracti- 

ve – in Munich, its surrounding areas and 

in all of Bavaria. Munich is a prospering 

world-class city, liberal but very safe, with 

Bavarian flair and unique recreational of- 

ferings. Unsurprisingly, Munich has one of 

the highest quality of life indexes of all large 

world-class cities. According to a study 

conducted by Mercer Human Resource 

Consulting, the Bavarian capital ranked 

fifth among the 53 metropolitan areas 

studied. Nuremberg came in 22nd – also in 

the top half – three positions ahead of San 

Francisco, the top US city. 

Bavaria’s appeal is particularly evident in 

the population trends: Every year, around 

85,000 people move to Munich alone. 

Many of the newcomers come from other 

countries. You will probably find it very 

easy to meet people from your own country 

in Munich, because about 300,000 people – 

close to 25 percent of the inhabitants of the 

city – come from other countries. 

Bavaria also has a very extensive cultural 

life, which adds immeasurably to the over- 

all quality of life. This includes theaters and 

movies as well as author readings and other 

cultural activities, including English-langu- 

age events. America House Munich is the 

center for English-language cultural events. 

In addition, Bavaria boasts a varied land- 

scape, historical sites, and a rich array of 

sporting and recreational possibilities. The 

Alps, which are ideal for summer and win- 

ter sports, are practically at your doorstep. 

25

Contact 

Financial Center Munich Initiative 

c/o Munich Stock Exchange 

Lenbachplatz 2a 

80333 Munich 

Germany 

E-Mail: kontakt@fpmi.de 

www.fpmi.de 

Members (as of January 2006) 

Allianz AG 

www.allianz.com 

Baader Wertpapierhandelsbank AG 

www.baaderbank.de 

Bavarian Bankers Association 

www.bayerischer-bankenverband.de 

Bavarian Chambers of Commerce and 

Industry (BIHK) 

www.muenchen.ihk.de 

Bavarian State Ministry of Economic 

Affairs, Infrastructure, Transport 

and Technology 

www.stmwivt.bayern.de 

Bayerische Hypo- und Vereinsbank AG 

www.hvb.de 

BayernLB 

www.bayernlb.de 

City of Munich 

www.muenchen.de/arbeitundwirtschaft 

Deutsche Bundesbank – Regional 

Office Munich 

www.bundesbank.de 

Genossenschaftsverband Bayern e. V. 

www.gv-bayern.de 

Handwerkskammer für München und 

Oberbayern 

www.hwk-muenchen.de 

HUK-COBURG insurance group 

www.huk.de 

ibi research 

www.ibi.de 

26 

Ifo Institute for Economic Research at 

the University of Munich 

www.ifo.de 

Institut für Kapitalmarktforschung 

und Finanzierung 

www.kmf.bwl.uni-muenchen.de 

KG Allgemeine Leasing GmbH & Co 

www.kgal-gruppe.de 

Lehrstuhl für Mathematische Statistik 

der TU München 

www-m4.ma.tum.de 

LfA Förderbank Bayern 

www.lfa.de 

Münchener Hypothekenbank 

www.muenchener-hypothekenbank.de 

Munich Re Group 

www.munichre.com 

Munich Stock Exchange 

www.boerse-muenchen.de 

Sparkassenverband Bayern 

www.sparkassenverband-bayern.de 

Swiss Re 

www.swissre.com 

TVM 

www.tvmvc.com 

vbw – Vereinigung der Bayerischen 

Wirtschaft 

www.vbw-bayern.de 

Versicherungskammer Bayern 

www.vkb.de 

Wirtschaftsprüferkammer 

www.wpk.de 

3i 

www.3i.com 

List of Illustrations 

Page 3: Erwin Huber, Bavarian Minister of Economics, Infrastructure, 

Commerce and Technology 

Pages 4/5: Panorama of Munich 

Pages 6/7: Munich Stock Exchange 

Page 8: Munich Re 

Page 9: Allianz Group Entrance Hall 

Pages 10/11: HypoVereinsbank 

Page 12: Small Atrium of HypoVereinsbank 

Page 14: Munich Stock Exchange 

Page 16: Baader Wertpapierhandelsbank 

Page 18: Bavarian Ministry of Economic Affairs, Infrastructure, 

Transport and Technology 

Page 20: Lecture Hall at the Technical University Munich 

Page 22: 3i 

Page 23: HypoVereinsbank 

Page 24: Airport Munich Franz Josef Strauß 

Picture credits: 

Bayerische Hypo- und Vereinsbank AG: Page 12 

Bavarian Ministry of Economic Affairs, Infrastructure, Transport and Technology: Page 3 

Jürgen Stein, Phase 4 Communications GmbH: Pages 6/7, 8, 10/11, 14, 16, 17, 18, 19, 20, 

22, 23, 24, 27 

Allianz AG : Page 9 

Getty Images : Pages 4/5

www.fpmi.de 

Financial Center Munich Initiative 

c/o Munich Stock Exchange 

Lenbachplatz 2a 

80333 Munich 

Germany 

E-mail: kontakt@fpmi.de

Munich Financial Center: Top in Finance! - Invest in Bavaria

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