Current Status of Postal Banking: The Case of Europe
Nr. 100 / November 1992
This paper provides both a historic overview of the genesis of postal banking services and of the current state of organisation, legal status, and business activities of European postal banks. Moreover, it is attempted to assess the impact the different activities of the EC in the fields of financial services will exert on postal banks in Europe.
In earlier decades postal banking services used to be focussed on payments and savings services with an emphasis on basic infrastructure. These services were provided jointly with postal and telecommunications services as part of the general activity of the State. Structural changes in the markets for financial services as well as the deregulation and liberalization of the telecommunications sector then have exercised a decisive influence on the development of postal banking in Europe. Many postal banks exhibit a fundamental re-organisation of their business activities and a reformulation of their market strategy almost always being accompanied by an extension of their products and services as well as by new marketing and distribution concepts.
There is an unambiguous tendency of European postal banks towards corporatization. This, however, does not automatically imply a privatisation in terms of shares. In this context a crucial point is the change of the status of the staff if a civil servant status is replaced by a employer-employee relationship under the terms of civil law.
Provision of postal and postal banking services by different entities often leads to controversies about contractual terms and the objectives therein. In several countries one can observe a reduction in the density of the postal branches and the branches where postal banking services are offered, respectively. Yet, for the total number of postal banks in Europe the postal branch network and the respective staff represents still an important resource of their activities.
In several European countries the business activity of postal banks is related to an activity of the State in banking. Postal banks still have to meet governmental objectives like e.g. financing the budget or public utilities. However, the market presence of the State is increasingly disputed especially in those countries being characterized by a competitive market structure.