LBBW makes KfW and Wüstenrot Bausparkasse DEBTVISION available as a platform for Schuldschein transactions
KfW was the first financial institution to successfully test the new digital marketplace DEBTVISION for refinancing. The development bank concluded a Schuldschein loan with a term of ten years and a volume of EUR 50 million with LBBW, the lender being Wüstenrot Bausparkasse.
DEBTVISION is a digital financing platform jointly developed by LBBW and Börse Stuttgart. Here, companies seeking capital, financial institutions and public institutions – all with good to very good credit ratings – meet established, financially strong investors. The transaction process in this front-end system is fully electronic, from marketing to subscription. The platform was launched at the beginning of June with a marketplace for Schuldschein loans.
“We like to test this new approach because we want to make our refinancing more efficient and even more attractive for investors with the help of modern technology. We are therefore following this development with great attention,” says Dr. Frank Czichowski, Head of Financial Markets and Treasurer at KfW. “The first transaction went smoothly and shows the scope for efficiency gains by streamlining the processes for marketing Schuldscheine. On DEBTVISION, the borrower can manage the complete marketing himself via the intuitive user interface of the web-based platform. The borrower always retains full transparency.
Investors also benefit from the digitization of the Schuldschein process. They have direct access to high-quality Schuldschein transactions via the marketplace and can sign electronically. “We are open to innovation and would like to explore these possibilities because we can also imagine carrying out capital market transactions using modern technologies such as blockchain,” explains Jürgen Steffan, CFO of Wüstenrot Bausparkasse AG, which directly takes over the KfW Schuldschein.
Following the launch of DEBTVISION with the marketing of corporate Schuldschein, KfW is the first bank to use the platform as a borrower. “The requirements for Schuldschein transactions for financials differ from those for Corporate Schuldscheine. This test has therefore provided us with valuable insights into the development of further marketplaces for other financing products,” explains Christoph Steinbrich, Managing Director of DEBTVISION.
„We have a broad customer base for Schuldscheine not only among companies, but also among banks and the public sector. Together with our placement strength and our high product competence as market leader, these are excellent prerequisites for establishing DEBTVISION on the market in the long term,” explains Dr. Christian Ricken, Board Member for Capital Markets at LBBW. “The smooth transaction via the new marketing channel is another building block in our excellent cooperation with KfW,” adds Patrick Seifert, Head of Primary Market Business at LBBW.
Further transactions with well-known Schuldschein companies and the connection of further investors are in preparation for the coming months. Based on the experience gained, DEBTVISION will be continuously expanded with additional functionalities. In addition, the integration of the blockchain is subsequently being prepared; while the platform primarily generates added value in initiating business, the blockchain streamlines implementation and processing and completes the digitalisation of the Schuldschein process.
It is planned that DEBTVISION will be open to interested companies and investors throughout the market from late summer. In the future, the marketplace will also enable the pure trading of Schuldschein deals, thus creating a transparent and efficient secondary market.
DEBTVISION is a joint subsidiary of LBBW and Börse Stuttgart. Founded in 2018 and headquartered in Stuttgart, the company operates the digital marketplace of the same name for Schuldschein loans. The Managing Director of DEBTVISION is Christoph Steinbrich, an experienced and in the market acknowledged Schuldschein expert.
Landesbank Baden-Württemberg is a medium-sized universal bank and the central institution of the savings banks in Baden-Württemberg, Saxony and Rhineland-Palatinate. With total assets of EUR 238 billion and over 10,000 employees (as of December 31, 2017), LBBW is one of the largest banks in Germany. Its core activities are corporate customer business, especially with medium-sized companies, and business with private customers and savings banks. Another focus is on real estate and project financing in selected markets as well as customer-oriented capital market business with banks, savings banks, and institutional investors.
About the Börse Stuttgart
The Börse Stuttgart is the private investor exchange and the leading floor trading centre in Germany. Private investors can trade shares, securitised derivatives, bonds, ETFs, funds and profit participation certificates in Stuttgart – with the highest execution quality and at best prices. Stuttgart is the market leader in Germany for corporate bonds traded on the stock exchange and the market leader in Europe for securitised derivatives. For investor protection and transparency, all regulatory and control mechanisms of a public stock exchange apply. With a trading volume of around EUR 81 billion in all asset classes in 2017, the Börse Stuttgart ranks tenth in Europe.
KfW is one of the world’s leading promotional banks. Since 1948 KfW has been working on behalf of the Federal Government and the Länder to improve economic, social and ecological living conditions worldwide. In 2017 alone KfW provided EUR 76.5 billion for this purpose. Of this amount, 43% went towards measures to protect the climate and the environment. KfW does not have any branches or customer deposits. It refinances its promotional business responsibly and almost entirely via the international capital markets. In 2017 it raised EUR 78.2 billion for this purpose. For 2018 KfW plans a refinancing volume of EUR 75-80 billion; approx. EUR 49 billion have already been raised on the international capital markets to date.
About Wüstenrot Bausparkasse
Wüstenrot Bausparkasse AG is the oldest institute of its kind in Germany and one of the most traditional real estate financiers. The Bausparkasse, number 2 on the German market, took over the mortgage lending and Pfandbrief business of Wüstenrot Bank AG Pfandbriefbank in 2017 and thus positioned itself as the first German building society with an active Pfandbrief business. Wüstenrot is part of the Wüstenrot & Württembergische Group, which was founded in 1999 and serves some six million customers in Germany in the areas of insurance, home ownership, risk protection and asset formation.