I think that not only is this a move to keep him in BVB long-term, but also to solidify BVB's presence in the NT. Mats as captain may as well push Jogi's hand to make him NT captain too, since Jogi likes his captains to have major captaincy roles on club level. So yes it's an excellent decision all around.
He's got a good presence on the pitch, I have no issue with him being CPT for Germany. Where does he sit on the pecking order?
There's Schweini and Neuer that may precede him, but Schweini will retire sooner or later and is injury prone, so is not a long term solution, and Neuer is too far from the action to have a true influence on the match, and isn't a club captain. I think Mats would be a perfect captain for the NT for the long term.
Schweini is the most deserving player on the squad for captaincy, hands down, but with euro's and next wc up ahead to be won, the team needs consistency and prevent revolving door of captains. As much as Schweini deserves it, I would count on Löw's pragmatism to pick a young leader to continue leading the team to trophies until his own respective retirement.
Like I said, I' mOK with Hummels. In spite of his history with Bayern (brought about by the FO), I think Hummels can be the heart of that team. He's passionate and has a strong personality.
Schweini is Captain. Germany work within a seniority order. I think Khedira may be next along with Neuer. Khedira and Kroos also wore the arm band for their German youth NT.