Conservative Business Risk Model
Our core business areas are residential and commercial property financing. The primary focus is residential property financing in Germany in association with Volksbanken and Raiffeisenbanken. This is a very low-risk business in a stable market environment with very low default rates. In commercial property financing we concentrate on top tier financing with low loan-to-value ratios and professional borrowers with good credit ratings. Our core markets are Germany, along with the economically strong regions of France and Great Britain.
We fund our operations on the capital markets and primarily by issuing mortgage-backed bonds (Mortgage Pfandbriefe) and public sector covered bonds (Public Pfandbriefe). The Pfandbrief is a particularly reliable and highly liquid funding instrument. There has never been a German Pfandbrief default. Their high quality is guaranteed through the stringent requirements of the German Pfandbrief Act. The rating agency Moody’s assigned MünchenerHyp’s Pfandbriefe the highest rating of Aaa.
Risk management plays an important role in the bank’s overall governance. The annually updated business and risk strategy sets out the operational framework for our business activities.