Introduction

There is a great deal of evidence available which is superficially consistent with the view that German banks act as delegated exercisers of equity's control rights. The banks, especially the three big banks, have control of a substantial proportion of the equity voting rights at the general meeting of shareholders in large AGs, mainly derived from the proxy votes they exercise rather than from their own holdings of shares. Gottschalk (1988), for example, analysed the votes cast at the shareholders' meetings of those 32 AGs among the largest 100 enterprises in 1984 which had more than 50% of their share capital either widely dispersed or owned by banks. All banks together had a majority of the votes cast in 31 of the 32 cases, and in 22 cases controlled more than 75% of the votes cast. The three big banks had a majority of the votes cast in 15 cases, and in a further 10 cases the big banks controlled between 25% and 50% of the votes cast. Banks are also represented on the supervisory boards of many large AGs, and again this representation is concentrated among the three big banks. The Monopolkommission (1980) found that in 1978 bank representatives occupied 145 seats on the supervisory boards of the largest 100 AGs. Bank representatives accounted for 9.8% of all supervisory board members, and 19.6% of shareholder representatives on supervisory boards. There were 20 supervisory board chairmen, and 6 deputy chairmen, among these 145 bank representatives. Banks as a whole were represented on the supervisory boards of 61 of the top 100 AGs.