Establishment of Banks Blog

Three Iranian Banks enter the German market through Munich

Iranian Banks enter the German market through Munich

Eight months after the Implementation Day and we have witnessed improving trading relationships between Germany and Iran. In the first six months of this calendar year the export from Germany to Iran has increased by 15% compared to the last year. Several business delegations from the states of Bavaria, Hesse, and Baden-Württemberg have traveled just recently to Iran and the eagerly anticipated German business delegation – led by the German Minister for Economic Affairs and Energy, Sigmar Gabriel – will soon make its way to Tehran.

Amendment of the Building Society Act (Bausparkassengesetz) introduces new refinancing possibilities for Building Societies

The amendment of certain fundamental legal foundations for the supervision of Building Societies as e.g. amendments of the German Banking Act required modifications of the Building Society Act. Furthermore, the business environment for the Building Societies’ business has changed: a low interest level in the capital market is accompanied by a strong demand for residential property financing.

Revised version of the Payment Service Directive

The European Parliament has adopted the revised version of the Payment Services Directive (PSD2) on October 8th, 2015. Before it can be published in the Official Journal of the European Community, the Directive still needs to be approved by the Council of Ministers of the European Union. After the approval, the Directive has to be implemented into national law within two years by the member states.

The revision of the Payment Services Directive will lead to amendments and adoptions of previous Directives and Regulations as well as the German Payment Services Supervision Act (ZAG).

Kleinanlegerschutzgesetz: Regulations for FinTechs (Part 2)

The German legislature ratified the final draft of the Kleinalegerschutzgesetz, Germany’s new investor protection law, which became effective 10 July 2015 (see also my previous blog on the early stages of the early stages of this law making process). However, not all the provisions were implemented in July; exceptions apply on the provisions of Art 13 (1) and (2), which come into effect on 1 January 2016 and 3 January 2017 respectively.

1. New rules

The Kleinanlegerschutzgesetz introduces the following major changes:

  • Specification and Extension of the obligation to publish a prospectus,

Consultation of the guidance notice for managing directors – The main focus is on material requirements

Part of the European harmonisation process is the development of uniform requirements concerning the managing director. They are also the key aspect of the consultation of the guidance notice of the Financial Supervisory Authority (BaFin) of 19th January 2015. There are some modifications:


BaFin drafted separated guidance notice for the scope of the Banking Act (Kreditwesengesetz), the German Payment Services Supervision Act (Zahlungsaufsichtsgesetz) and the Investment Act (Kapitalanlagenschutzbuch) and a separate guidance notice for the Insurance Supervision Act (Versicherungsaufsichtsgesetz). Hence BaFin expects a more clear structure.


Establishment of banks: an option for corporations? – Part 2

As explained in the preceding post regarding the recent PwC-Whitepaper “Establishment of banks: an option for corporations?”, the establishment of corporate-owned banks is not a strategic option for the german industrial sector even though the automotive industry is using them with great success.

These results contrast with the high demand for individualized financial services. Every other surveyed corporation wishes for increased efficiency and professionalization of financing activities within the firm. Beyond that working capital-management (36%), securing sales (34%), securing the supply-chain (27%) and diversification of business activities (27%) were central needs.

Establishment of banks: an option for corporations? – Part 1

It’s hard to imagine an automotive industry without corporate-owned financial institutions. Sector expertise concerning customer data, residual values and distribution channels allow for lending and leasing as well as the offering of appropriate insurance-models at attractive terms. In addition to these products the corporate-owned banks also offer classic banking products such as day-to-day money or credit cards. Thus they do not only optimize corporate financial activity but also enhance customer loyalty. Are corporate-owned banks therefore the next logical step towards an evolved industrial business model and can increased establishment be expected in the future?

Swiss banks: New chances for market entry in Germany by means of a simplified regulatory framework

FINMA and BaFIN finally came to an agreement regarding all the required concrete measures for the so called “Simplified Exemption Procedure”. Thereby the regulatory framework for the market entry of Swiss banks in Germany will be facilitated.


In the past, Swiss banks going for a business activity in Germany without establishing a physical presence were required to meet several conditions which made conducting business operations more complicated. In particular, Swiss banks had to involve a locally active German / EEA bank for the customer identification of private clients.

New 5th edition of Banking Business in Germany is due for 2016

As time goes by …

Although it seems to me as if the 4th edition of Banking Business in Germany was finalised only yesterday: The regulatory pace is still high and changes the framework of the financial services market day by day. So the authors from Association of Foreign Banks in Germany (Verband der Auslandsbanken in Deutschland e.V.) and PwC will convene once more over the next months in order to implement the latest developments into a new 5th edition of this practical guide for foreign banks establishing a subsidiary or a branch in Germany.

Calculation of the contributions to the German deposit guarantee scheme – Overview and preview of the new contributions regulation

When establishing or acquiring a bank in Germany, a regulatory business plan must be provided to the German Federal Financial Supervisory Authority which contains, amongst other things, the expected costs. These costs include the mandatory contribution payments to the German deposit guarantee scheme Entschädigungseinrichtung deutscher Banken GmbH (EdB).