German household wealth grows to record level

BERLIN, April 13 (Xinhua) -- The value of financial assets held by German private households reached a new record level, figures by the German central bank (Bundesbank) showed on Friday.

According to the Frankfurt-based institution, German wealth rose by around 5 percent to a total of 5.8 billion euros (7.2 billion U.S. dollars) in 2017. The development was mainly driven by rising share prices on global stock markets and defied a persistent low-interest rate environment which is widely viewed as harmful to savers in Germany.

Bundesbank's definition of private household wealth includes cash, bank deposits, equities and insurance claims but real estate.

The institution noted that insurance and pension funds remained the most attractive investment vehicles to Germans (2.1 billion euros). "Even in the context of a low interest rate, the investment behavior of private households is suggestive of a strong preference for investments which are liquid or perceived as low-risk," a statement by the Bundesbank read.

At the same time, however, stock market investments became more popular in 2017, with the number of share owners reaching a ten-year high (over 10 million individuals). Traditionally risk-averse German savers hereby spent 16 billion euros in equities in the fourth quarter of 2017 alone.

Reacting to the release of the official data on Friday, the German Social League (VdK) urged policymakers to do more to reduce wealth inequality in Germany. VdK president Ulrike Mascher criticized it as a "fatal development" that more and more people relied on social security benefits to survive, while private wealth continued to grow on the other. (1 euro = 1.23 U.S. dollars) Enditem