The consolidation process in the German banking sector continued in 2018. The total number of credit institutions in Germany has fallen by 40 to 1,783 institutions.

Overview of the research conferences of the Deutsche Bundesbank by year.

Every year, BaFin and the Deutsche Bundesbank draw up their priorities for the supervision of less significant institutions (LSIs) in Germany. This is intended to ensure the effective and efficient use of resources, especially in terms of risk-oriented supervision.

The global financial crisis was a lesson that it is not enough to merely monitor the stability of individual banks – the stability of the banking sector as a whole is also a crucial factor, which is precisely what the countercyclical capital buffer (CCyB), a key instrument under the Basel III regime, is there to help safeguard. However, recent research indicates that adhering too strictly to the reference indicator envisaged under the Basel III framework might lead to a situation in which supervisors activate the CCyB either too late or not at all ahead of a future financial crisis.