Chapter 3 starts the recalibration of financialisation by telling an alternative history of German finance. It zooms in on the struggles over deposits to provide the historical and institutional backdrop to appreciate the key differences and overlaps in US and German financial markets, and to understand those financial developments that set them apart from the 1960s onwards. This chapter examines the development of the Pfandbrief (covered bond) from the eighteenth century onwards to establish that market-based funding practices have a long history in Germany. After the devastation of the Seven Years’ War (1756–1763), banks and the state (the Prussian prince and its gentry) together sought new ways to boost lending and borrowing with the help of financial securities and collateral. This chapter shows that German housing finance was historically much more market-based than in the US. While the Pfandbrief has been a key financial security promoting long-term lending, it was used predominantly by specialised mortgage and public savings banks. Universal banks only entered the fray in the 1970s when their corporate deposits declined. Chapter 3 shows that German banking was geared towards market-based finance but different to the one that emerged as part of US-led financialisation.