Germany

The Federal Financial Supervisory Authority (BaFin) functions as an independent and supreme financial regulatory body of Germany, founded in 2002 through the enactment of the FinDAG Act. The body is based in Bonn and Frankfurt am Main and exercises supervision of the financial sector in Germany through the banking, insurance, and securities industries. BaFin represents the German regulatory system abroad in international bodies such as BCBS, IOSCO, and IAIS. For further information about BaFin, visit the BaFin Website.

BaFin performs three key operational roles to safeguard consumers, maintain market integrity, and ensure stability within the German financial industry. The first role involves solvency supervision, wherein it conducts banking supervision jointly with the Deutsche Bundesbank, as the only body that is authorized to grant and withdraw banking licenses, prescribe capital adequacy, and impose executive sanctions on entities that fail to comply. Market supervision forms the second role of BaFin, that sees it enforcing strict rules on transparency, prohibition of market manipulation and insider trading in public stock markets, regulating crypto-asset service providers (CASP), and supervising collective investment funds. Last but not least, BaFin works towards ensuring anti-money laundering (AML) and combating the financing of terrorism (CFT) compliance and consumer protection by inspecting the internal risk framework and installing sanction screening systems.