ifo Business Climate Index Continues to Decline
What does this mean for the financing side?
Once again, the ifo Business Climate Index provides well-founded signals from a leading institute that the situation for companies will remain highly challenging.
On the financing side, we see an additional challenge:
🔹 It is reasonable to expect that the 2025 annual financial statements of most companies will not perform better in bank ratings than their 2024 financial statements.
🔹 The banking sector has been subject to increased capital adequacy requirements under Basel IV since the beginning of 2025 – something that, in our view, has not yet been fully passed on to the market.
👉 Taken together, it seems likely that financing in 2027 will not become easier or more affordable.
Our recommendation is straightforward and easy to implement:
👉 Make greater use of asset-based financing solutions such as leasing and sale & leaseback!
👉 This allows you to finance over longer terms at lower costs while improving your cash flow profile!
👉 Key metrics such as the equity ratio and leverage ratio will also improve! Some companies may even benefit directly in their pricing through margin ratchet mechanisms!
How do you assess the further development on the financing side?
