Regulatory Alerts2020-03-31 | General Administrative Act regarding a decrease in the domestic countercyclical capital buffer rateGeneral Administrative Act Reducing the Domestic Countercyclical Capital Buffer Rate to 0%
The Federal Financial Supervisory Authority (BaFin) issued a General Administrative Act effective 1 April 2020 that reduces Germany’s domestic countercyclical capital buffer rate to zero percent of total risk exposure. This adjustment applies to credit institutions and financial holding groups under the Banking Act, aiming to free up capital for lending and mitigate financial market stress triggered by the COVID-19 pandemic. BaFin will maintain the zero percent rate until at least 31 December 2020, conducting quarterly assessments to determine whether an increase will be necessary as economic conditions evolve.
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