Banking Supervision

Banking Supervision

A well functioning economy requires a stable banking system. Banking supervision is therefore responsible for monitoring credit institutions’ business activity and maintaining investor confidence. In Germany, the task of banking supervision is shared by the Bundesbank and the Federal Financial Supervisory Authority (BaFin). In particular, the Bundesbank is in charge of monitoring the credit institutions.

Current aspects
FinTechs

Interest rate risk

Symposium

BAIT consultation
Brexit

Corona

Basel III impact study

Report on bank offices
Machine Learning in Risk Models

BaFin and Deutsche Bundesbank are putting their joint consultation paper “Machine Learning in Risk Models – Characteristics and Supervisory Priorities” out for consultation. It deals with the concrete use of machine learning (ML) in risk models of Pillars I and II of the regulatory framework for banks and insurers.

Machine Learning in Risk Models
The Bundesbank wants the EU to comply with Basel III

In a joint letter, the Deutsche Bundesbank and 24 other national central banks and financial supervisory authorities within the EU are now calling for the European Commission to ensure that the proposal on updated capital adequacy rules for banks in the EU follows the global agreement known as Basel III. More precisely, we who are signing the joint letter wish to particularly emphasise that the output floor for risk-weighted assets and the standard method for credit risk should comply with the international agreement. Deviating from the Basel agreement could have a negative impact on confidence in both the European banking sector and the EU regulatory framework. It is therefore important that the global agreements are met in full and in a consistent manner.

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MaRisk in the version of 16/08/2021

The currently seventh, version of the Minimum Requirements for Risk Management (MaRisk) was published on 16 August 2021. A special focus was placed on the transposition of the guidelines of the European Banking Authority (EBA) on management of non-performing and forborne exposures as well as on outsourcing into German supervisory practice. In addition, individual requirements from the EBA guidelines on the management of ICT and security risk management, i.e. information and communication technology, were included. The new version of the MaRisk entered into force upon its publication. For the implementation deadlines for new requirements, please refer to the attached cover letter.

MaRisk in the version of 16/08/2021
Basel III reform package: Bundesbank sees no impediments to SME funding

The European Commission’s proposals for implementing the new tighter capital requirements for banks are a topic of public debate. Critics say the additional requirements will hit small and medium-sized enterprises in particular. The Bundesbank, meanwhile, sees no impediments to SME funding. Executive Board member Joachim Wuermeling says the legislative proposal would not involve any changes for most of the 1,300 institutions.

Basel III reform package: Bundesbank sees no impediments to SME funding

Bundesbank supports greater proportionality in EU remuneration rules

The Bundesbank advocates more tiered EU remuneration rules depending on a bank’s size and complexity as part of the impending implementation of the Basel III finalisation. Thought should be given as to whether small, non-complex institutions “need even more proportional regulation” under the EU’s current remuneration regime, the authors write in the October edition of the Monthly Report.

Bundesbank supports greater proportionality in EU remuneration rules
Ensuring internal capital adequacy of less significant institutions (LSIs)

The Bundesbank has conducted an analysis of how internal capital adequacy is ensured within the German banking market. The results are generally positive, but most of the institutions still show a need for further structural improvement.

Ensuring internal capital adequacy of less significant institutions (LSIs)
Supervisory assessment of bank-internal capital adequacy concepts and their integration into firm-wide performance and risk management processes ("ICAAP") – realignment

Bundesbank and BaFin have jointly redrafted the 2011 ICAAP guideline and published it on 24.05.2018. The realignment of the paper was made necessary by developments at the global and European levels as well as ongoing changes in institutional and regulatory practices.

Supervisory assessment of bank-internal capital adequacy concepts and their integration into firm-wide performance and risk management processes ("ICAAP") – realignment
Speeches

Speaking at various occasions, members of the Bundesbank’s Executive Board regularly comment on issues relating to banking supervision.

Speeches
Discussion papers

Click here for academically oriented studies prepared by the Research Centre, including work on financial stability, most of which is written in English.

Discussion papers