BKS Annual Publication 2026

The 2026 issue in detail

The key themes of the 2026 issue

• Rising NPL stocks in Germany reaching €48.7bn – up 43% in two years – with a Stage 2 pipeline of €469bn as a reliable early indicator
• A commercial real estate (CRE) refinancing wall of €74bn to €86bn for the years 2026 to 2028 and a leading NPL wave driven by StaRUG-based restructurings
• Internationalisation of the buyer market, with bidding consortia of investors and licensed servicers replacing the classic “one-stop-shop” providers
• Stability of residential real estate loans despite expiring low-interest fixed-rate periods and €436bn in refinancings up to 2030
• Compliance requirements arising from the Secondary Credit Market Act, CCD II and the new Insolvency Harmonisation Directive
• Lessons from two years of DORA implementation in the financial sector

Table of contents

Editorial
A journey through almost two decades of BKS – Jürgen Sonder

Market development
NPL market development 2025/2026 – Jan Dzieciol / Marcel Köchling
No respite: the wave of insolvencies continues – Monika Binninger / Frank Poschmann

Practice
A leading NPL wave instead of classic NPL sales – Oliver Platt
International players and new complexity – Jörg Jünger / Fabian Zwanzig
How stable are residential real estate loans in Germany? – Lars Schröter
The resolution of distressed real estate projects in the current market environment – Janine Hardi
Restructuring as an opportunity: how banks protect their loan portfolios – Ludwig Weber / Dietmar Haffa
Financial education: prospects for Germany – Fabienne Lindner

Regulation
Compliance for NPL credit purchasers and servicers – Cristina Bachmeier
DORA: lessons from the Digital Operational Resilience Act – Ragnar Malmros / Sonja Schäfer

Core content of the publication

A journey through almost two decades of BKS

In his final foreword as President, Jürgen Sonder looks back on the development of the association since its founding in 2007 – from the NPL Forum as a loose specialist event, through the Berlin office from 2012, to today’s admission to the European Commission’s NPL Advisory Panel. The strategic realignment of BKS towards a European voice for the secondary credit market becomes the central mandate for the coming term of the Executive Committee.

NPL market development 2025/2026

Jan Dzieciol and Dr Marcel Köchling describe the “European paradox”: the NPL stock of German banks has risen by 43% within two years to €48.7bn, while Greece, Italy and Spain have reduced their legacy portfolios. At 15.52%, the Stage 2 ratio is well above the EU average of 9.10% and signals further growth potential in NPL stocks. 44% of the banks surveyed in the NPL Barometer expect an NPL volume of €50bn to €60bn by the end of 2026. The NPL ratio for commercial real estate has reached 6.91%, and 4.58% in the SME segment.

No respite: the wave of insolvencies continues

Monika Binninger and Frank Poschmann analyse insolvency activity in 2025: more than 11,000 opened proceedings involving corporations and partnerships – an increase of around 5% over the already insolvency-heavy previous year. Major insolvencies with turnover above €50m reached 140 cases. Retail, construction and freelance services were particularly affected. Self-administration proceedings reached a new high in 2025 with 522 preliminary proceedings. The rescue rate for major insolvencies now stands at just 33.1% – in 2021 it was still almost 60%.

A leading NPL wave instead of classic NPL sales

Oliver Platt shows that the commercial real estate refinancing wall of €74bn to €86bn in the years 2026 to 2028 is leading less to classic NPL portfolio sales than to pre-insolvency restructurings. StaRUG, with its cross-class cram-down mechanism, allows haircuts on the senior, junior and equity sides before loans are formally recognised as non-performing on the balance sheet. Single-case restructurings in the range of €75m to €90m are becoming the norm, while large portfolios rarely reach the market any more.

International players and new complexity

Jörg Jünger and Fabian Zwanzig describe the structural shift in the buyer market: the “one-stop-shop” model has given way to bidding consortia of international investors – mostly from the private equity sector – and licensed servicers. English is becoming the contract language, with anti-money-laundering measures and PEP screening now mandatory. Data preparation follows the EBA NPL templates, and pricing is model-based and scenario-driven. Forward flow agreements and joint ventures are gaining importance over classic spot transactions.

How stable are residential real estate loans in Germany?

Lars Schröter explains why the residential segment has remained robust despite the interest rate turnaround. The NPL ratio in retail lending stands at 0.97%, a record low. In 2025, BaFin lowered the sectoral systemic risk buffer for residential real estate financing from 2% to 1%. The key test lies ahead: by 2030, mortgage loans totalling €436bn with historically low fixed-rate periods will expire. With refinancing at 3.8% instead of 1.5%, the monthly instalment rises by around 50%.

The resolution of distressed real estate projects

Janine Hardi analyses how to deal with project companies stuck in the construction and marketing phase. bulwiengesa reports construction stoppages on 89 projects totalling 0.92 million square metres for the first half of 2025. For around 34% of planned residential projects, the start of construction is delayed. Value maximisation succeeds only through coordination of creditors, professional marketing processes and – where necessary – fresh capital to bring projects into a transaction-ready state.

Restructuring as an opportunity

Dr Ludwig Weber and Dr Dietmar Haffa present the concept of the restructuring owner. Where the financing bank has lost confidence in management or shareholders, the restructuring owner takes over the company shares and steers the reorganisation process. Unlike a trustee solution, economic ownership transfers in full. Three practical cases illustrate its use in international group structures, business splits and liquidations. In the background: €469bn in Stage 2 loans in Germany.

Financial education: prospects for Germany

Fabienne Lindner frames financial education as a key competence of modern societies – comparable to civic education or media literacy. Digitalisation, neo-brokers and “buy now, pay later” models lower barriers to entry but raise cognitive demands. The institutional fragmentation of education in Germany meets a gap that finfluencers on social media are increasingly filling. The need for action is particularly evident among women, on the subject of retirement provision and in financially fragile households.

Compliance for NPL credit purchasers and servicers

Cristina Bachmeier traces the shift in EU legislation from purely market-oriented regulation towards a hybrid regime with a clear emphasis on consumer protection. Three legal acts interlock: the Secondary Credit Market Act as the national transposition of the NPL Directive, the Consumer Credit Directive CCD II with stricter creditworthiness checks and the inclusion of BNPL and small loans, and the new Insolvency Harmonisation Directive, whose trilogue compromise was finalised in December 2025. Compliance costs and documentation requirements rise accordingly.

DORA: lessons from the Digital Operational Resilience Act

Ragnar Malmros and Sonja Schäfer summarise experience from two years of DORA practice. There is no off-the-shelf solution – firms with mature process mapping, an integrated ICT risk view and an aligned DOR and ICT strategy derive the greatest value. Third-party management and qualitative internal reporting remain the biggest challenges. DORA is not a sprint but a marathon, and continues to evolve as a dynamic regulatory framework.