German firms upbeat about 2016 but worried about banks - DIHK

BERLIN (Reuters) - German companies feel business conditions have never been better and see exports improving after a weak spell, the DIHK Chambers of Commerce said on Wednesday, though it sounded a note of caution about the banking sector.

The body's optimistic note came in the face of weak industrial output and export data released on Tuesday that suggested Europe's largest economy lost momentum at the end of last year and may struggle this year.

"Companies view their current business situation on the whole as being as good as never before," DIHK said, publishing a survey of member businesses.

DIHK stuck to its forecast of 1.3 percent growth for Europe's biggest economy this year, lower than the government's 1.7 percent outlook, which was revised down last month from 1.8 percent due largely to a slowdown in emerging markets.

The Chambers of Commerce said export expectations in the industrial sector were improving again, but investment plans were up only slightly. Many companies expressed a willingness to make new hires.

DIHK managing director Martin Wansleben said companies were concerned about the weakness of financial institutions like Deutsche Bank whose shares tumbled to a 30-year low this week on investor concerns about its capital levels.

"We need strong banks," he said, adding that questions about the stability of big financial institutions were a concern for the whole global economy. "We are of course worried."

Deutsche Bank, Germany's flagship lender has trailed its rivals in bouncing back from the 2008 financial crisis, hamstrung by ageing technical infrastructure and having to pay out billions of dollars in fines to end legal disputes.

(Reporting by Gernot Heller; Writing by Joseph Nasr; Editing by Madeline Chambers and Andrew Heavens)