Germany - Revision history

imported>Doug Williamson: Update for LIBOR transition.

2022-04-25T21:05:04Z

Update for LIBOR transition.

← Older revision		Revision as of 21:05, 25 April 2022
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	* Bank loans – the main funding instruments in the German money market have historically been bank loans, characterised above all by their flexibility, with virtually no minimum amount or minimum holding period. Availability depends on credit lines. Costs and margins over basis rates on bank instruments can only be stated in general terms, as they depend on market conditions and credit evaluation. Likewise, additional charges and borrowing costs are negotiable. Credit information is available from the credit agencies Schufa, Creditreform and Schimmelpfennig. Ratings from the international agencies like Moody’s and Standard and Poor’s are very important for major companies. It has been reported that due to the financial crisis and high equity regulations of banks, the availability of bank loans has decreased;		* Bank loans – the main funding instruments in the German money market have historically been bank loans, characterised above all by their flexibility, with virtually no minimum amount or minimum holding period. Availability depends on credit lines. Costs and margins over basis rates on bank instruments can only be stated in general terms, as they depend on market conditions and credit evaluation. Likewise, additional charges and borrowing costs are negotiable. Credit information is available from the credit agencies Schufa, Creditreform and Schimmelpfennig. Ratings from the international agencies like Moody’s and Standard and Poor’s are very important for major companies. It has been reported that due to the financial crisis and high equity regulations of banks, the availability of bank loans has decreased;
	* Overdrafts – now used less frequently as a source of working capital financing. Interest rates are set autonomously by banks in line with market conditions and creditworthiness, with only a loose connection to market rates. Rates tend to be higher than on term loans, but any cash inflows reduce the loan amount. On occasion a commitment fee may be applied;		* Overdrafts – now used less frequently as a source of working capital financing. Interest rates are set autonomously by banks in line with market conditions and creditworthiness, with only a loose connection to market rates. Rates tend to be higher than on term loans, but any cash inflows reduce the loan amount. On occasion a commitment fee may be applied;
	* Short-term loans – short-term loans with fixed maturities are available with the option to negotiate maturity, frequency and type (fixed or floating) of interest payments. Roll-over agreements exist as well. Rates depend on market conditions, and can be pegged to Euribor ~~or Euro-Libor~~. Depending on the purpose of the loan, a number of government subsidy programmes can be accessed; and		* Short-term loans – short-term loans with fixed maturities are available with the option to negotiate maturity, frequency and type (fixed or floating) of interest payments. Roll-over agreements exist as well. Rates depend on market conditions, and can be pegged to Euribor. Depending on the purpose of the loan, a number of government subsidy programmes can be accessed; and
	* Commercial paper – Euro commercial paper can be issued by prime issuers, mainly corporations. CP rates are set at Euribor ~~or Euro-Libor~~, plus or minus a margin, which depends on the respective credit quality of the corporate. The minimum amount size depends on the corporation’s decision, normally €5m up to €100m for new issues. Alternatively, German and Euro-commercial paper can be arranged in other currencies. In this sector, credit ratings are important and are more readily available.		* Commercial paper – Euro commercial paper can be issued by prime issuers, mainly corporations. CP rates are set at Euribor, plus or minus a margin, which depends on the respective credit quality of the corporate. The minimum amount size depends on the corporation’s decision, normally €5m up to €100m for new issues. Alternatively, German and Euro-commercial paper can be arranged in other currencies. In this sector, credit ratings are important and are more readily available.

	Besides the above, a number of other financing instruments are in frequent use. Banks offer intermediate factoring and leasing arrangements and provide guarantees. Down-payments, supplier credits and other short-term financing techniques are in use as well. Moreover, bonded loans become more popular for companies’ medium- and long-term debt financing. Bonded loans are regarded as loans and not as securities; hence the preparation of an issue prospectus is not necessary, while they are in general easy to transfer in the OTC market.		Besides the above, a number of other financing instruments are in frequent use. Banks offer intermediate factoring and leasing arrangements and provide guarantees. Down-payments, supplier credits and other short-term financing techniques are in use as well. Moreover, bonded loans become more popular for companies’ medium- and long-term debt financing. Bonded loans are regarded as loans and not as securities; hence the preparation of an issue prospectus is not necessary, while they are in general easy to transfer in the OTC market.

	==Risk management==		==Risk management==

imported>Doug Williamson: Update for LIBOR transition.

2022-04-25T21:04:12Z

Update for LIBOR transition.

← Older revision		Revision as of 21:04, 25 April 2022
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	==Liquidity management==		==Liquidity management==
	===Benchmark rates===		===Benchmark rates===
	German interbank money market rates are commonly based on Euribor rates ~~(instead of Libor rates)~~.		German interbank money market rates are commonly based on Euribor rates.
	The Euribor for time deposit and euro overnight index average (EONIA) for overnight are widely accepted benchmarks for the euro money market.		The Euribor for time deposit and euro overnight index average (EONIA) for overnight are widely accepted benchmarks for the euro money market.

imported>Doug Williamson: Update for LIBOR transition.

2022-04-25T21:01:32Z

Update for LIBOR transition.

← Older revision		Revision as of 21:01, 25 April 2022
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	* ''Cash concentration (batch-based)'' – at the end of each accounting day, the balances on the sub-accounts included in the procedure are transferred automatically for the original value date, to the designated main account. At the end of the accounting day, the sub-accounts show a balance of zero. Cash concentration (batch-based) can be used internationally.		* ''Cash concentration (batch-based)'' – at the end of each accounting day, the balances on the sub-accounts included in the procedure are transferred automatically for the original value date, to the designated main account. At the end of the accounting day, the sub-accounts show a balance of zero. Cash concentration (batch-based) can be used internationally.
	* ''Cash concentration (SWIFT-based)'' – This cash concentrating process enables accounts at almost all third-party banks to be integrated into cash pooling structures. At the end of the day or at times defined by the customer, the balances of these sub-accounts are transferred to the predefined main account at the bank using SWIFT MT101. The balance in the sub-account is at disposal in the customer’s bank account with the same value date as the posting date of the concentrating transfer.		* ''Cash concentration (SWIFT-based)'' – This cash concentrating process enables accounts at almost all third-party banks to be integrated into cash pooling structures. At the end of the day or at times defined by the customer, the balances of these sub-accounts are transferred to the predefined main account at the bank using SWIFT MT101. The balance in the sub-account is at disposal in the customer’s bank account with the same value date as the posting date of the concentrating transfer.
	* ''Margin compensation (cross-currency)'' – does not entail physically transferring liquidity to a predefined account. Accounts with the bank in Germany and abroad can be involved in this interest rate optimisation process. Thus, Margin Compensation can be used internationally, in different currencies and is based on the currency specific reference interest rate, ~~e.g. EONIA or overnight Libor~~ plus or minus a margin. The margins to be used are derived from the ratio of the balances of all integrated accounts. The more the balances offset each other, the more the net interest income will be optimised.		* ''Margin compensation (cross-currency)'' – does not entail physically transferring liquidity to a predefined account. Accounts with the bank in Germany and abroad can be involved in this interest rate optimisation process. Thus, Margin Compensation can be used internationally, in different currencies and is based on the currency specific reference interest rate, plus or minus a margin. The margins to be used are derived from the ratio of the balances of all integrated accounts. The more the balances offset each other, the more the net interest income will be optimised.
	* ''Notional pooling'' – merely involves adding together the value date balances to calculate the interest. No physical balance settlement via the main account is performed; the balances of the sub-accounts produced as a result of credit and debit entries are maintained.		* ''Notional pooling'' – merely involves adding together the value date balances to calculate the interest. No physical balance settlement via the main account is performed; the balances of the sub-accounts produced as a result of credit and debit entries are maintained.

imported>Doug Williamson: Mend broken link.

2018-12-01T17:44:41Z

Mend broken link.

← Older revision		Revision as of 17:44, 1 December 2018
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	\|header9 =		\|header9 =
	\| label9 = Other professional financial/banking associations:		\| label9 = Other professional financial/banking associations:
	\| data9 = [http://~~germanbanks~~.bankenverband.de Bundesverband deutscher Banken (Association of German Banks)]		\| data9 = [http://en.bankenverband.de Bundesverband deutscher Banken (Association of German Banks)]
	[http://www.vab.de Verband der Auslandsbanken in Deutschland (Association of Foreign Banks in Germany)]		[http://www.vab.de Verband der Auslandsbanken in Deutschland (Association of Foreign Banks in Germany)]

imported>Doug Williamson: Replace broken link to Deutsche Boerse with link to Frankfurt Stock Exchange.

2017-08-20T15:46:25Z

Replace broken link to Deutsche Boerse with link to Frankfurt Stock Exchange.

← Older revision		Revision as of 15:46, 20 August 2017
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	'''German Central Bank'''		'''German Central Bank'''
	* [http://www.bundesbank.de http://www.bundesbank.de]		* [http://www.bundesbank.de http://www.bundesbank.de]
	'''~~German~~ stock exchange'''		'''Frankfurt stock exchange'''
	* [http://~~www~~.~~deutsche~~-~~boerse~~.~~com~~ http://~~www~~.~~deutsche~~-~~boerse~~.~~com~~]		* [http://en.boerse-frankfurt.de/ http://en.boerse-frankfurt.de/]
	'''German Financial Supervisory Authority'''		'''German Financial Supervisory Authority'''
	* [http://www.bafin.de http://www.bafin.de]		* [http://www.bafin.de http://www.bafin.de]

imported>Jeeten.patel@thinkpublishing.co.uk at 09:46, 8 October 2015

2015-10-08T09:46:55Z

← Older revision		Revision as of 09:46, 8 October 2015
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	* [http://www.bundesbank.de http://www.bundesbank.de]		* [http://www.bundesbank.de http://www.bundesbank.de]
	'''German stock exchange'''		'''German stock exchange'''
	* [http://www.deutsche-~~exchange~~.de http://www.deutsche-~~exchange~~.de]		* [http://www.deutsche-boerse.com http://www.deutsche-boerse.com]
	'''German Financial Supervisory Authority'''		'''German Financial Supervisory Authority'''
	* [http://www.bafin.de http://www.bafin.de]		* [http://www.bafin.de http://www.bafin.de]

imported>Jeeten.patel@thinkpublishing.co.uk at 09:45, 8 October 2015

2015-10-08T09:45:18Z

← Older revision		Revision as of 09:45, 8 October 2015
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	\|header5 =		\|header5 =
	\| label5 = GDP:		\| label5 = GDP:
	\| data5 = €2,~~664.2bn~~ (~~2012~~)		\| data5 = €2,742bn (2013)
	\|header6 =		\|header6 =
	\| label6 = IGTA member:		\| label6 = IGTA member:
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	==Financial regulatory framework==		==Financial regulatory framework==
	Deutsche Bundesbank, the national central bank of Germany, is a member bank of the European System of Central Banks (ESCB). Deutsche Bundesbank fulfils its tasks according to the primary objective, the maintenance of price stability and arranges the execution of domestic and international payments.		Deutsche Bundesbank, the national central bank of Germany, is a member bank of the European System of Central Banks (ESCB). Deutsche Bundesbank fulfils its tasks according to the primary objective, the maintenance of price stability and arranges the execution of domestic and international payments.
	Bank supervision is ~~carried out by~~ the German Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht, BaFin, Bonn/Frankfurt, [http://www.bafin.de www.bafin.de]) and Deutsche Bundesbank (headquarters in different German cities, [http://www.bundesbank.de www.bundesbank.de]). According to the German Banking Act (KWG), which is supplemented by principles, guidelines and regulations especially the German Solvency Regulation (SolvV) and the liquidity ordinance (LiquV), banks must have adequate liable capital and must ensure adequate liquidity at all times. The regulations on own funds are in line with the EU law. In connection with the new capital requirements according to the CRD IV Package there will be major changes regarding the capital adequacy ratio, the bank’s necessary tier 1 and tier 2 capital and its liquidity. BaFin also supervises the proper functioning of the securities and derivatives markets by pursuing the objectives of investor protection, market transparency and market integrity.		On 4 November 2014, the European Central Bank (ECB) adopted the authority to monitor the financial stability of banks within the eurozone through its Single Supervisory Mechanism (SSM), in line with the EU’s SSM Regulation No 1024/2013 conferring specific tasks on the ECB with regard to the prudential supervision of credit institutions. The ECB has final supervisory authority, with member states’ national supervisory authorities now providing a supporting role. The ECB directly supervises the 120 “most significant” banks within each eurozone member state. The ECB is responsible for supervisory reviews, on-site inspections and investigations; granting/withdrawing banking licences; assessing bank acquisitions; ensuring compliance with EU prudential rules; and, if required, setting higher capital requirements to counter financial risks.
			Germany’s national supervisory authorities are the German Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht, BaFin, Bonn/Frankfurt, [http://www.bafin.de www.bafin.de]) and Deutsche Bundesbank (headquarters in different German cities, [http://www.bundesbank.de www.bundesbank.de]). According to the German Banking Act (KWG), which is supplemented by principles, guidelines and regulations especially the German Solvency Regulation (SolvV) and the liquidity ordinance (LiquV), banks must have adequate liable capital and must ensure adequate liquidity at all times. The regulations on own funds are in line with the EU law. In connection with the new capital requirements according to the CRD IV Package there will be major changes regarding the capital adequacy ratio, the bank’s necessary tier 1 and tier 2 capital and its liquidity. BaFin also supervises the proper functioning of the securities and derivatives markets by pursuing the objectives of investor protection, market transparency and market integrity.
	The basic regulatory legal framework for the German securities and derivatives markets is set out in the Securities Trading Act (WpHG) and the Securities Prospectus Act (Wertpapierprospektgesetz). Moreover, BaFin supervises the payment service provider, the institutions which conduct e-money business as well as alternative investment funds and the alternative investment fund manager following the Alternative Investment Fund Manager Directive (AIFMD).		The basic regulatory legal framework for the German securities and derivatives markets is set out in the Securities Trading Act (WpHG) and the Securities Prospectus Act (Wertpapierprospektgesetz). Moreover, BaFin supervises the payment service provider, the institutions which conduct e-money business as well as alternative investment funds and the alternative investment fund manager following the Alternative Investment Fund Manager Directive (AIFMD).

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	==Taxation framework==		==Taxation framework==
	The general withholding tax rate (WHT) on bank interest and dividend income amounts to 25% (26.375%, including the mandatory solidarity surcharge).		The general withholding tax rate (WHT) on bank interest and dividend income amounts to 25% (26.375% including the mandatory solidarity surcharge).
	There is no WHT levied on interest, which is paid to non-residents (limited liability for taxation) unless the interest bearing assets are secured by domestic real estate property.		There is no WHT levied on interest, which is paid to non-residents (limited liability for taxation) unless the interest bearing assets are secured by domestic real estate property.
	Regarding WHT on dividends, exemptions may apply according to double tax treaties (DTT) or the implemented EU Parent-Subsidiary-Directive.		Regarding WHT on dividends, exemptions may apply according to double tax treaties (DTT) or the implemented EU Parent-Subsidiary-Directive.

	===Business tax===		===Business tax===
	In Germany 15.825% corporation tax (including the mandatory solidarity surcharge) and ~~approximately~~ 14% trade tax apply. The exact rate of the trade tax depends on the local seat of the company.		In Germany 15.825% corporation tax (including the mandatory solidarity surcharge) and 14%-17% trade tax apply. The exact rate of the trade tax depends on the local seat of the company.

	~~===Financial Transaction Tax (FTT)===~~
	FTT applies to certain financial transactions. It is planned to implement FTT in Germany by 1 January 2016. FTT will be levied at the financial institution’s level. Currently it is under discussion whether a treasury centre that conducts financial transactions could be regarded as a financial institution according to FTT. Hence, depending on the respective transaction FTT might arise.

	===Interest expense limitation===		===Interest expense limitation===
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	==Banking service provision==		==Banking service provision==
	The universal banks are the dominating banking group within the German banking system. They cover the range of commercial banking and investment banking activities. Universal banks can be divided into three groups: private commercial banks, Landesbanken ~~comprising~~ savings ~~banks~~ and co-operative banks.		The universal banks are the dominating banking group within the German banking system. They cover the range of commercial banking and investment banking activities. Universal banks can be divided into three groups: private commercial banks, Landesbanken and mutual savings and co-operative banks.
	In addition, there are specialised financial institutions such as the Kreditanstalt für Wiederaufbau and mortgage banks.		In addition, there are specialised financial institutions such as the Kreditanstalt für Wiederaufbau and mortgage banks.

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	===Euro Banking Association===		===Euro Banking Association===
	The Euro Banking Association is an organisation of ~~approximately 150~~ European banks. EBA Clearing Company was established to operate different payment systems: the EURO1 large-value payment system and the STEP1 low-value payment system.		The Euro Banking Association is an organisation of over 180 European banks. EBA Clearing Company was established to operate different payment systems: the EURO1 large-value payment system and the STEP1 low-value payment system.
	EURO1 is a payment system for cross border and domestic transactions in euro between banks operating in the European Union.		EURO1 is a payment system for cross border and domestic transactions in euro between banks operating in the European Union.
	In general STEP1 is a payment system for commercial transactions to process single cross border payments in euro. It enables banks that operate in the European Union to exchange commercial payments with the other STEP1 participants – as well as all participants of EURO1 banks.		In general STEP1 is a payment system for commercial transactions to process single cross border payments in euro. It enables banks that operate in the European Union to exchange commercial payments with the other STEP1 participants – as well as all participants of EURO1 banks.
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	SEPA can be defined as Single Euro Payments Area where the current differentiation between national and cross border payments no longer exists. Under SEPA, users of payment services will be able to make cashless payments (SEPA Cards Framework, SEPA Credit Transfer, SEPA Direct Debit) in euro from a single payment account anywhere in the European Union as well as in Norway, Iceland, Switzerland, Monaco and Liechtenstein. The Payment Services Directive constitutes a significant legal basis for the settlement of cashless payments.		SEPA can be defined as Single Euro Payments Area where the current differentiation between national and cross border payments no longer exists. Under SEPA, users of payment services will be able to make cashless payments (SEPA Cards Framework, SEPA Credit Transfer, SEPA Direct Debit) in euro from a single payment account anywhere in the European Union as well as in Norway, Iceland, Switzerland, Monaco and Liechtenstein. The Payment Services Directive constitutes a significant legal basis for the settlement of cashless payments.
	In Germany the national transformation of the Payment Services Directive took place in two parts: the regulatory (effective since 2009) and the civil law part (effective since 2010).		In Germany the national transformation of the Payment Services Directive took place in two parts: the regulatory (effective since 2009) and the civil law part (effective since 2010).
	The new pan-European payment instruments initially operated alongside national instruments. ~~Over the long term and due~~ to efficiency reasons, the national instruments ~~are~~ gradually ~~being~~ abolished. According to the EU Regulation “amending Regulation (EU) No 260/2012 as regards the migration to ~~Union~~-wide credit transfers and direct debits” of 26 February 2014, ~~the national instruments for Germany~~ and ~~countries within the eurozone should expire at the beginning of~~ August 2014 ~~(migration has already been completed within certain eurozone countries)~~.		The new pan-European payment instruments initially operated alongside national instruments. Due to efficiency reasons, the national instruments have gradually been abolished. According to the EU Regulation “amending Regulation (EU) No 260/2012 as regards the migration to EU-wide credit transfers and direct debits” of 26 February 2014, migration to SEPA credit transfers and direct debits was finalised on 1 August 2014. However, legacy non-preauthorised direct debits will remain in use until 1 February 2016.

	==Cash and bank account management==		==Cash and bank account management==
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	* ''€ overnight indexed swap'' – Eonia swap allows the swap of any fixed period between two days and 12 months against overnight. This uses the Euribor overnight fixing as a reference instead.		* ''€ overnight indexed swap'' – Eonia swap allows the swap of any fixed period between two days and 12 months against overnight. This uses the Euribor overnight fixing as a reference instead.
	* ''Caps, floors, collars, swaps, forward rate agreements (FRAs) and swap options'' – these are available from banks. They are usually bound to three or six month Euribor, although the recent trend has been towards greater flexibility. Trades usually take place in minimum sizes of €5m and multiples thereof. OTC options on bonds are usually traded in lots of €10m. Users of options in connection with swaps need a credit line. All these products are liquid.		* ''Caps, floors, collars, swaps, forward rate agreements (FRAs) and swap options'' – these are available from banks. They are usually bound to three or six month Euribor, although the recent trend has been towards greater flexibility. Trades usually take place in minimum sizes of €5m and multiples thereof. OTC options on bonds are usually traded in lots of €10m. Users of options in connection with swaps need a credit line. All these products are liquid.
	* ''Futures'' – options are traded on EUREX and ~~LIFFE~~ (contract size €1m). Both exchanges also list contracts on 10-year notional Bundesanleihen. However, EUREX has also set up a futures contract on two-year Schatz, five-year Bobl and 10-year bund.		* ''Futures'' – options are traded on EUREX and ICE (contract size €1m). Both exchanges also list contracts on 10-year notional Bundesanleihen. However, EUREX has also set up a futures contract on two-year Schatz, five-year Bobl and 10-year bund.

	==Websites==		==Websites==
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	* [http://www.bundesbank.de http://www.bundesbank.de]		* [http://www.bundesbank.de http://www.bundesbank.de]
	'''German stock exchange'''		'''German stock exchange'''
	* [http://www.exchange.de http://www.exchange.de]		* [http://www.deutsche-exchange.de http://www.deutsche-exchange.de]
	'''German Financial Supervisory Authority'''		'''German Financial Supervisory Authority'''
	* [http://www.bafin.de http://www.bafin.de]		* [http://www.bafin.de http://www.bafin.de]
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	* [http://www.destatis.de http://www.destatis.de]		* [http://www.destatis.de http://www.destatis.de]
	'''European Central Bank'''		'''European Central Bank'''
	* [http://www.ecb.de http://www.ecb.de]		* [http://www.ecb.europa.eu http://www.ecb.europa.eu]

	[[Category:Book_Export]]		[[Category:Book_Export]]

imported>Doug Williamson: Protected "Germany" (‎[edit=sysop] (indefinite) ‎[move=sysop] (indefinite))

2015-07-27T13:07:14Z

Protected "Germany" (‎[edit=sysop] (indefinite) ‎[move=sysop] (indefinite))

← Older revision	Revision as of 13:07, 27 July 2015
(No difference)

imported>Jeeten.patel@thinkpublishing.co.uk at 09:34, 17 November 2014

2014-11-17T09:34:28Z

← Older revision		Revision as of 09:34, 17 November 2014
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	* ''Futures'' – options are traded on EUREX and LIFFE (contract size €1m). Both exchanges also list contracts on 10-year notional Bundesanleihen. However, EUREX has also set up a futures contract on two-year Schatz, five-year Bobl and 10-year bund.		* ''Futures'' – options are traded on EUREX and LIFFE (contract size €1m). Both exchanges also list contracts on 10-year notional Bundesanleihen. However, EUREX has also set up a futures contract on two-year Schatz, five-year Bobl and 10-year bund.

	Government website		==Websites==
			'''Government website'''
	* [http://www.bundesregierung.de http://www.bundesregierung.de]		* [http://www.bundesregierung.de http://www.bundesregierung.de]
	German Central Bank		'''German Central Bank'''
	* [http://www.bundesbank.de http://www.bundesbank.de]		* [http://www.bundesbank.de http://www.bundesbank.de]
	German stock exchange		'''German stock exchange'''
	* [http://www.exchange.de http://www.exchange.de]		* [http://www.exchange.de http://www.exchange.de]
	German Financial Supervisory Authority		'''German Financial Supervisory Authority'''
	* [http://www.bafin.de http://www.bafin.de]		* [http://www.bafin.de http://www.bafin.de]
	Federal Statistical Office		'''Federal Statistical Office'''
	* [http://www.destatis.de http://www.destatis.de]		* [http://www.destatis.de http://www.destatis.de]
	European Central Bank		'''European Central Bank'''
	* [http://www.ecb.de http://www.ecb.de]		* [http://www.ecb.de http://www.ecb.de]

	[[Category:Book_Export]]		[[Category:Book_Export]]

imported>Jeeten.patel@thinkpublishing.co.uk at 09:32, 17 November 2014

2014-11-17T09:32:04Z

← Older revision		Revision as of 09:32, 17 November 2014
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	==Financial regulatory framework==		==Financial regulatory framework==
	Deutsche Bundesbank, the national central bank of Germany, is a member bank of the European System of Central Banks (ESCB). Deutsche Bundesbank fulfils its tasks according to the primary objective, the maintenance of price stability and arranges the execution of domestic and international payments.		Deutsche Bundesbank, the national central bank of Germany, is a member bank of the European System of Central Banks (ESCB). Deutsche Bundesbank fulfils its tasks according to the primary objective, the maintenance of price stability and arranges the execution of domestic and international payments.
	Bank supervision is carried out by the German Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht, BaFin, Bonn/Frankfurt, www.bafin.de) and Deutsche Bundesbank (headquarters in different German cities, www.bundesbank.de). According to the German Banking Act (KWG), which is supplemented by principles, guidelines and regulations especially the German Solvency Regulation (SolvV) and the liquidity ordinance (LiquV), banks must have adequate liable capital and must ensure adequate liquidity at all times. The regulations on own funds are in line with the EU law. In connection with the new capital requirements according to the CRD IV Package there will be major changes regarding the capital adequacy ratio, the bank’s necessary tier 1 and tier 2 capital and its liquidity. BaFin also supervises the proper functioning of the securities and derivatives markets by pursuing the objectives of investor protection, market transparency and market integrity.		Bank supervision is carried out by the German Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht, BaFin, Bonn/Frankfurt, [http://www.bafin.de www.bafin.de]) and Deutsche Bundesbank (headquarters in different German cities, [http://www.bundesbank.de www.bundesbank.de]). According to the German Banking Act (KWG), which is supplemented by principles, guidelines and regulations especially the German Solvency Regulation (SolvV) and the liquidity ordinance (LiquV), banks must have adequate liable capital and must ensure adequate liquidity at all times. The regulations on own funds are in line with the EU law. In connection with the new capital requirements according to the CRD IV Package there will be major changes regarding the capital adequacy ratio, the bank’s necessary tier 1 and tier 2 capital and its liquidity. BaFin also supervises the proper functioning of the securities and derivatives markets by pursuing the objectives of investor protection, market transparency and market integrity.
	The basic regulatory legal framework for the German securities and derivatives markets is set out in the Securities Trading Act (WpHG) and the Securities Prospectus Act (Wertpapierprospektgesetz). Moreover, BaFin supervises the payment service provider, the institutions which conduct e-money business as well as alternative investment funds and the alternative investment fund manager following the Alternative Investment Fund Manager Directive (AIFMD).		The basic regulatory legal framework for the German securities and derivatives markets is set out in the Securities Trading Act (WpHG) and the Securities Prospectus Act (Wertpapierprospektgesetz). Moreover, BaFin supervises the payment service provider, the institutions which conduct e-money business as well as alternative investment funds and the alternative investment fund manager following the Alternative Investment Fund Manager Directive (AIFMD).