Market update on non-performing loans (NPLs): German commercial property under pressure

How are non-performing loans (NPLs) developing in the German property sector? What differences are particularly noteworthy when compared with the rest of Europe? And what are the implications of the current trends for banks and investors? You can find the answers now in the latest issue of our English-language NPL Market Monitor.

NPL data serve as a key leading indicator of credit risks and strains within the financial system: they provide insight into how the quality of loan portfolios is evolving and in which market segments pressure is building up. In addition to NPL ratios – the proportion of non-performing loans relative to the total loan portfolio – volume trends and early risk signals in particular provide important indications of potential changes in the lending environment.

The impact of refinancing pressure, valuation adjustments and market liquidity on loan portfolios

In the NPL Market Monitor, our experts analyse the current situation, with a particular focus on the commercial property sector (Commercial Real Estate, CRE). The report examines the impact of refinancing pressures, valuation adjustments and market liquidity on loan portfolios.

Non-Performing-Loan Market Monitor

Focus: Commercial Real Estate Germany

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Three key findings in a concise preliminary overview

Steady performance amid mounting pressure

NPL ratios in Europe remained largely stable at the start of 2026. However, increased refinancing pressure, higher interest expense and greater uncertainty are leading to rising credit risks in certain markets and portfolios.
Different trends in Europe and Germany

Whilst some southern European markets are already at a more advanced stage in reducing non-performing loans, numerous institutions in western and northern Europe are still in the process of adjusting their portfolios. In Germany, the problems have so far been concentrated in specific segments and are not widely spread across all loan portfolios.
Commercial property remains the focus of market developments

The pressure to adapt is particularly evident in the commercial property sector. Higher refinancing costs, falling valuations and upcoming loan maturities are putting pressure on many financing arrangements. Transaction activity in the German CRE NPL market remains subdued, whilst banks continue to expand their monitoring, restructuring and risk management measures.