In an attempt to get more favourable access to capital from the
German central bank, luxury vehicle manufacturer BMW is looking to
secure a banking license for its financial arm, sources said.
The sources, close to the company, told German business daily
Handelsblatt that a partnership with the banking arm of
Daimler has already been rejected, adding that there were no
further plans for cooperation with other banks.
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Securing a banking license would enable BMW to access funds at
favourable rates of around 1 percent.
It is understood that BMW and Daimler each have to refinance
over €20 billion per year on the capital markets in order to keep
their leasing businesses afloat.
In February, BMW Financial Services reported a pre-tax loss of
€292 million, attributing the result to a number of factors
including a risk provision expense of €1.1 billion to cover
residual value risks and bad debts.
Jason T Hesse
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