Unless otherwise noted, all data, graphs and tables have been produced to illustrate EU 28 data. The EU 28 data contained in this chapter has been compiled from publicly available information released by the European Central Bank unless otherwise noted. The data relevant for EFTA countries has been compiled from the corresponding national central bank, financial supervisory authority, national office of statistics and national banking associations members of the European Banking Federation.


Number of credit institutions

The downward trend in the number of EU-28 credit institutions, which started in 2009, continues ten years after, with the number falling to 5,981 in 2019. The decline however is the slightest (-107 units) since the trend started. This marked a decline of 1.8% compared to the previous year and a reduction of 2,544 (-30%), in total, since contraction started. Most of the consolidation continues taking place within credit institutions, legally incorporated into the reporting country, where the stock has fallen by 35% since 2008. Consolidation in the banking sector continues helping to reduce overcapacity and aiming to enhance profitability.

The countries that experienced the largest contraction in absolute terms in 2019 were Germany, leading for a second year in a row, with -51 units, Austria (-23), Poland (-18) and Italy (-18), according to the ECB. Romania (+41), UK (+10), Portugal (+8), Croatia (+2), Sweden (+2), the Netherlands (+1) and Malta (+1) were the only countries where the number of credit institutions increased.

The number of credit institutions in the EFTA countries was 406 in 2019, down from 410 in 2018. While the stock has fallen since 2009, the same as in the EU 28, EFTA experienced a lower pace with a decline of 17% compared to 30% in the EU-28. Although the number of credit institutions reached a new lowest level in 2019, the number has remained relatively stable over the last four years. While Liechtenstein and Norway have experienced only minimal changes since 2009, Switzerland has experienced the largest contraction over the last 10 years (-79). Iceland, in contrast, has more than doubled with 10 credit institutions in 2019.

Branches and subsidiaries

The rationalisation taking place in the EU banking sector continues to involve bank branches as the number of (domestic) branches continues to shrink, falling to about 163,000 by the end of 2019. Compared to the previous year, branches in the EU-28 decreased, at a steady pace, by 6%, or about 10,000 branches, the largest drop since the financial crisis. The number of branches has fallen by 31% since 2008, or by almost 75,000. This trend continues reflecting the increasing use of digital banking by consumers as more than half of EU individuals, 58%, used internet banking in 2019, up from 54% in 2018, and 25% in 2007, when the data series began. This confirms that banking customers have continuously, widely and enthusiastically, adopting electronic payments as well as online and mobile banking. This has consequently reduced the importance of widespread bank branch networks, allowing banks to scale back further their physical presence.

The countries that experienced the largest contraction in absolute terms in 2018 were Spain (-2,162) and Germany (-1,267 units). Only Bulgaria, for the second year in a row, added branches (+278 units).

Already for a number of years, a trend in the establishment of branches has been dominating that of subsidiaries in the EU. At a consolidated bank level, there were 968 foreign bank branches in the EU in 2019, of which 730 were from other EU Member States. The number of bank branches from third countries shows a marginal decline. Germany is the country with the highest number of foreign branches from the other EU Member States, having 87 branches, followed by Spain with 78. The UK is the country with the highest number, 94, of third country branches, more than three times as many as the 26 non-EU countries branches present in Italy and France.

The overall number of subsidiaries continued declining for the twelfth consecutive year, falling by 4.4% to 513, the lowest level since 1997. The number of subsidiaries of credit institutions from other EU countries fell by 15 in 2019. The number of non-EU credit institutions’ subsidiaries dropped to 226, down from 289 in 2010, the highest number since 2007.

The number of domestic branches in EFTA countries reached 3,507 in 2019 with Switzerland hosting almost practically three out four branches in the area. The total number of subsidiaries in EFTA countries was 27 in 2019.

Bank staff

Banks have a large stake in society as important job creators, as they employed a little over 2.6 million people in the European Union by end-2019. This is about 43,000 fewer than in 2018 making a new lowest level since the ECB’s data series began in 1997. Not surprisingly, the countries with the largest number of jobs in this sector continue to be the countries with the largest financial centres in Europe: Germany, France, United Kingdom, Italy and Spain. These five EU economies employ some 68% of the total EU-28 staff employed. Out of these five countries only Germany (+13,661) and Italy (+6,163) had a substantial increase in the number of employees in 2019. In the particular case of Italy, the workforce increased in 2019 was due to the incorporation by a large intermediary of a service company belonging to one same banking group. Without such operation, the total number of employees would have decreased in line with the trend observed in the 2007-2018 period.

Despite having about 5,000 fewer employees than in 2018, Poland remained the country in Eastern and Central Europe with the largest number of jobs in the sector. Including EFTA countries, the number of staff employed in the banking sector was about 2.741 million.

Banking and related financial services activities make a significant contribution to the EU’s economy.  Despite the drop-in bank employment in recent years, about one in every 100 jobs in the EU continued to be a banking job in 2019. In the past decade, between 3% and 4% of the value of compensation of employees and gross value added to the EU economy has come from financial services (excluding insurance and pension activities).

Also reflecting a contraction in the banking sector, the average number of inhabitants per bank staff member in the EU Member States slightly rose from 192 in 2018 to 196 in 2019. The average number has been rising each year since 2008, with 28% increase in total, when it was 153. Romania is the country with the highest number, 365 inhabitants per bank staff member, while Luxembourg has the lowest number with 23 inhabitants per bank staff.

Regarding the number of inhabitants per bank branch. France is at one extreme, where each branch welcomes an average of 1,869 citizens, while at the other is Estonia where a branch provides services to an average of 15,961 inhabitants. The average number of inhabitants per bank branch in the EU-28 is slightly over 5,500.

Compared to 10 years ago, a 69% increase has been registered in the average number of inhabitants per bank branch mainly due to the streamlining of the branch network in the EU 28 reaching an average of 5,536 in 2019 up from 3,281 in 2010.

Meanwhile in the EFTA countries, the number of banks staff declined by 14% in 2019. This is about 1,800 fewer than in 2018, and 14,000 compared to 2009, making the lowest level in at least 10 years. Switzerland employed about 75% of the total EFTA staff. Ony Liechtenstein added employees (78). Switzerland had about 1900 fewer employees followed by Iceland and Norway with 1,166 and 671 fewer employees respectively).

The decline in staff in the EFTA countries is reflected in the inhabitants per bank staff members rising to 114 in 2019 from 111 in the previous year. Norway leads the area with the highest number, 217 inhabitants per bank staff member, followed by Iceland (126), Switzerland (96) and Liechtenstein closing with the lowest number of inhabitants per bank staff member (17).

Banks continue promoting gender equality initiatives aiming to reach gender balance at all levels. Female employees in the top 15 EU banks counted for more than half of the total workforce in 2019. The gap was broader (750 basis points difference) compared to the 2018 (180 basis points difference). Along with other sectors, part of the initiatives is to encourage board seats for female executives; the average (17.6%) in 2019 was still below desired quotas but higher than in 2018 (12.9%) which confirms the rising trend.