German industrial conglomerate Siemens AG plans to set up a bank of its own in an effort to reduce risks of financing difficulties following the economic crisis, the company said Monday.

Siemens aims to expand the product portfolio of its financial services unit — boosting the sales finance area, adding flexibility to the group's financing and optimizing its risk management, spokesman Marc Langendorf said.

However, it won't provide retail banking services.

"The financial crisis has shown that financing has to be broadly spread across several banks in order to minimize the risk," Langendorf said.

Siemens has submitted an application to Germany's banking authority, which is currently under review.

A company official familiar with the matter, speaking on condition of anonymity because the application is still pending, said approval is expected before the end of the year.

Lending money to its own customers to facilitate sales won't pose an additional risk to Siemens since it will always have its products as collateral, spokesman Langendorf said. "And we'll be acting in sectors that we know very well, just as our clients' business models," Langendorf said.

U.S. competitor General Electric Co. has a full-blown financial division which also offers banking products for consumers. Last year, the financial crisis led to a big spike in losses on loans GE Capital made for mortgages, credit cards and commercial real estate.

Siemens' chief financial officer told the daily Sueddeutsche Zeitung that his company was not only seeking to diversify its sales financing, but also to strengthen its own liquidity management.

"Our liquidity currently stands at almost 9 billion euros ($11.1 billion), therefore we especially need safe investment opportunities," Kaeser was quoted as saying in the newspaper's Monday edition.

He argued that, since the regulatory environment still isn't entirely transparent, the company could still be hurt if banks get in trouble.

Kaeser didn't give a precise outlook for the second quarter, but said orders and profitability were up, just as the recent strengthening of the dollar against the euro is "good for Siemens."

Siemens' stock gained 1.4 percent in Frankfurt to 75.12 euros. The company is based in Munich and has some 400,000 employees worldwide, with products ranging from light bulbs to trains.