A savings bank is a financial institution that is not run on a profit-maximizing basis, and whose original or primary purpose is collecting deposits on savings accounts that are invested on a low-risk basis and receive interest. Savings banks have mostly existed as a separate category in Europe.

Savings banks originated in late-18th Europe as a development of the Enlightenment, and became a Europe-wide phenomenon in the first half of the 19th century.[1] The trajectories of savings bank systems then diverged across European nations, variously leading to the formation of integrated banking groups, cohesive national networks, conversion into cooperative banking or commercial banking entities, and/or piecemeal consolidation with other credit institutions. In most countries, the surviving savings banks have private-sector status and no longer operate under a distinctive legislative framework; significant exceptions include Germany and Luxembourg, where savings banks are public-sector entities.


In many European languages, savings banks are referred to by a word that differentiates them from banks (French: caisse, German: Kasse, Italian: cassa, Russian: касса, Spanish: caja) and denotes their more restricted scope of activity, sometimes translated as "fund". That word has no direct equivalent in English; its etymology is identical with that of cash and it originally referred to a cash box, then a cash register.


The origin of savings banks lies in liberal and philanthropic aspirations that motivated their promoters to create non-profit establishments aimed at promoting a culture of thrift and financial prudence among the lower classes, and using savings and the logic of compound interest as an incentive to think beyond short-term living horizons. In France, savings banks projects started to emerge in the 1750s and multiplied during the French Revolution but with no lasting success. Liberal luminaries including Adam Smith, Thomas Robert Malthus and Jean-Baptiste Say took interest in the economic and social role of savings.[1]

The oldest lasting savings bank is widely recognized to have been the Ersparungsclasse der Allgemeinen Versorgungsanstalt established in Hamburg in 1778, followed by other endeavors in Germany and Switzerland in the late 18th century. Savings banks mushroomed in the early 19th century, with landmark establishments in Göttingen (1801, first municipal savings bank), Ruthwell, Scotland (1810, first in the United Kingdom), Boston (1816, first in the United States), Paris (1818, first in France), and Vienna (1819, first in the Austrian Empire). Even so, origin stories of the savings bank concept were long disputed. In 1914, the New Student's Reference Work said of the origins of savings banks:[2]

France claims the credit of being the mother of savings banks, basing this claim on a savings bank said to have been established in 1765 in the town of Brumath, but it is of record that the savings bank idea was suggested in England as early as 1697. There was a savings bank in Hamburg, Germany, in 1778 and in Berne, Switzerland, in 1787. The first English savings bank was established in 1799, and postal savings banks were started in England in 1861.

The original function of savings banks to service consumers was limited to savings, not borrowing, a foundational difference with cooperative banking which started developing a bit later during the 19th century. Savings banks were typically heavily regulated and supervised by local or national governments, and restricted to invest only in government debt or other instruments deemed of low financial risk. Over time, however, these distinctions have tended to erode, and over the 20th century the regulatory framework and business model of savings banks has largely converged with those of commercial banks, albeit with significant variations across jurisdictions.

Starting in 1861 with the establishment of the British Post Office Savings Bank, savings banks were increasingly subject to competition from postal savings systems which similarly collected retail savings and invested them in safe government securities, albeit with variations across countries; some of the postal banks have themselves been called "savings banks", e.g. the Rijkspostspaarbank in the Netherlands (est. 1881), the Caisse Nationale d'Épargne in France (est. 1882), the Austrian Postsparkasse and Hungarian Postal Savings Bank in Austria-Hungary (est. 1882 and 1886 respectively), the People's Own Savings Bank in Zimbabwe (est. 1904, renamed in 1999), the Government Savings Bank in Thailand (est. 1913), the Caisse d'Épargne de Madagascar (est. 1918), and the National Savings Bank in Sri Lanka (est. 1971), and the Postal Savings Bank of China (est. 2007).

After a long period of relative stability, including through two world wars and the European banking crisis of 1931 during which they were comparatively less affected than commercial banks, the savings banks came under increasing competitive pressure during the interest rate turmoil of the 1970s and underwent significant transformation and restructuring in many jurisdictions during the last quarter of the 20th century. By the early 21st century, savings banks were most significant in Germany and Spain, and to a lesser extent in Austria.[3]: 164 

In Communist banking systems during the 20th century, monopolistic national retail banking networks were often labeled as savings banks. The label survives in the names of several significant Central and Eastern European commercial banks such as DSK Bank in Bulgaria, Česká spořitelna in Czechia, OTP Bank in Hungary, PKO Bank Polski in Poland, Sberbank in Russia, Slovenská sporiteľňa in Slovakia, and Oschadbank in Ukraine. Other non-European banks (other than postal savings systems or their successors) similarly named include the Botswana Savings Bank and Savings and Social Development Bank [ar] in Sudan.

By country

By chronological order of inception (not including postal savings systems):


The World Savings Banks Institute (WSBI), was created in 1924 in Milan, relocated in 1949 in Amsterdam and again in 1969 in Geneva and in 1994 in Brussels. Since then, the WSBI and the European Savings Banks Group (est. 1963) have operated as a single entity, representing savings banks on a European and global basis and serves as a forum to compare savings banks practices. Most of its non-European members are cooperative banks, public banks, or postal savings systems rather than savings banks in the original European sense.[12]

See also


  1. ^ a b Carole Christen-Lécuyer (2004), "Histoire des Caisses d'épargne en France. 1818-1881. Une étude sociale", Revue d'histoire du XIXe siècle (28)
  2. ^ The full text of Banks from The New Student's Reference Work at Wikisource
  3. ^ Dilek Bülbül, Reinhard H. Schmidt & Ulrich Schüwer (September 2013), "Caisses d'épargne et banques coopératives en Europe", Revue d'économie financière (111(3))
  4. ^ Max Seidel (1908), "Das Sparkassenwesen", Zeitschrift für die gesamte Staatswissenschaft / Journal of Institutional and Theoretical Economics (64:1): 58–107
  5. ^ Per H. Hansen (December 2007), "Organizational Culture and Organizational Change: The Transformation of Savings Banks in Denmark, 1965—1990", Enterprise & Society (8:4): 920–953
  6. ^ "Seanad Éireann - 23/Jun/1965 Trustee Savings Bank Bill, 1965: Second and Subsequent Stages". Retrieved 29 January 2016.
  7. ^ Alane Moysich (1997), "The Mutual Savings Bank Crisis" (PDF), History of the Eighties: Lessons for the Future, vol. 1, Washington DC: Federal Deposit Insurance Corporation
  8. ^ "The oldest monetary institution in Slovenia". Bankarium.
  9. ^ Arthur Grimes (February 1998), "Liberalisation of financial markets in New Zealand", Reserve Bank of New Zealand Bulletin (61:4)
  10. ^ Felipe Portocarrero Maisch (2000), Las cajas municipales de ahorro y crédito: su experiencia en el micro crédito rural en Perú, Inter-American Development Bank
  11. ^ "Austria's RZB buys Albania's biggest bank". The Banker. 5 January 2004.
  12. ^ "WSBI Members". WSBI-ESBG.