Kleve – An increasing number of cooperative banks are requiring assistance from their own protection scheme. Volksbank Kleverland has now applied for such support. The relevant body is the protection scheme of the National Association of German Cooperative Banks (BVR). The BVR is the umbrella organization for the cooperative banking sector in Germany; its protection scheme is designed to stabilize member banks facing financial difficulties. An audit at Kleverland revealed a significant need for value adjustments on several loans. The bank is unable to fully absorb these costs on its own without risking a breach of capital requirements in the foreseeable future. Consequently, guarantees are intended to preserve the bank’s own contingency reserves. The amount of aid has not yet been disclosed, though the bank states that day-to-day operations are continuing as normal.
Volksbank Kleverland is part of a wider pattern
The significance of this case stems primarily from the accumulation of similar incidents. In just over two and a half years, the BVR protection scheme has already propped up five banks with guarantees and grants, involving a total volume of around €1.5 billion. Volksbank Kleverland is now the latest addition to this list. Furthermore, a need for additional support is emerging at Volksbank Braunschweig Wolfsburg. Clearly, this is no longer a matter of an isolated outlier in the Lower Rhine region.
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Raiffeisenbank im Hochtaunus clearly illustrates the potential scale of these issues. At the end of 2024, the bank faced acute risks totaling €503.449 million in its investor and project finance business. The BVR protection scheme provided guarantees amounting to €438.113 million to cover this exposure. The bank’s own management report notes that it was precisely these support measures that stabilized its financial position. A loan portfolio focused almost entirely on commercial real estate financing played a pivotal role in the situation. Bankhaus RSA also received stabilization measures worth around €60 million; however, subsequent analysis revealed that this assistance was insufficient.
Real Estate, Loans, and Equity Investments Become Problematic
Unusual risks are also a central issue at Volksbank Braunschweig Wolfsburg (known as “Brawo”). In May, the bank proactively called upon the BVR protection scheme and requested coverage measures to address potential write-downs. Its network of equity investments comprises more than 400 companies, extending far beyond the scope of typical regional banking operations. Consequently, in June, Volksbank appointed restructuring expert Heiner Arnoldi to its management board; he is tasked with reducing complexity and driving the turnaround process.
Kleverland itself also has a troubled history. Its CEO at the time lost his position in late 2025 after internal irregularities came to light, and the bank subsequently filed a criminal complaint against him. Meanwhile, merger talks with Volksbank an der Niers in Goch are currently on hold, as the institution intends to resolve its own issues first. It is also noteworthy that Kleverland required BVR assistance more than two decades ago; the current crisis thus affects a bank that has already relied on the protection system in the past.
BVR Tightens Oversight of Troubled Cooperative Banks
The BVR is responding to this series of incidents with significantly stricter rules. In June, its general assembly expanded the intervention powers of the protection scheme. The scheme now has the right to attend and speak—with justification—at meetings held by banks classified as being in a preventive or restructuring phase. Furthermore, it can impose higher contributions at an earlier stage on institutions with problematic risk profiles. At the same time, the BVR’s executive board is gaining greater decision-making authority regarding necessary remedial measures. These steps aim to ensure that adverse developments are identified sooner and restructuring processes begin more quickly.
The reform also highlights a vulnerability in the cooperative model. While the protection system prevents the problems of individual institutions from directly affecting their customers, the member banks themselves bear the financial consequences within their mutual support network. Consequently, BVR President Marija Kolak has criticized “high-risk business activities, mismanagement, or grossly negligent behavior” at certain institutions. At the same time, the association emphasizes that, to date, no customer of an affiliated bank has lost deposits due to insolvency. According to the BVR, the system also requires no state aid. However, the accumulation of costly cases illustrates why the association intends to curb risky business models much earlier in the future.
Author: Blackout News
Sources: Handelsblatt (12.08.26) – Kölner Stadt-Anzeiger (12.08.26) – Welt (16.06.26) – BVR (10.06.26)