Fitch has thus underscored the successful performance achieved by the Cooperative Financial Network, which has met the challenges of recent years by drawing on its own resources. The funds for the capital increase carried out by the cooperative central institutions were supplied by the strongly capitalized local cooperative banks (Volksbanken and Raiffeisenbanken), in their capacity as shareholders. Supplementing this measure, the cooperative central institutions have reduced their risks further. The BVR protection scheme, which can look back on a successful history spanning more than 80 years, continues to provide the framework that binds the 1,062 local banks and cooperative central institutions together.
Despite the fact that interest rates have remained persistently low, the banks have delivered an impressive financial performance. The banks in the Cooperative Financial Network have continually strengthened their capital by retaining profits and thus drawing on their own financial resources. Their success is based on their strong brand and the support that they receive from their 30 million or so customers, which include more than 18 million members. Building on this sustainable business model, the banks in the Cooperative Financial Network run their solid and granular lending business, which they fund by drawing on their broad base of customer deposits.
Fitch's credit rating applies to all institutions that are covered by the BVR protection scheme. These include the local cooperative banks (Volksbanken and Raiffeisenbanken), Sparda banks, PSD banks, church cooperative banks, cooperative central institutions, cooperative mortgage banks, and other specialized institutions in the Cooperative Financial Network such as the building society Bausparkasse Schwäbisch Hall and individual Union Investment companies.