Abstract
All credit institutions are subject to State supervision and are defined in Article 1 of the 1961 Banking Law1 as ‘enterprises engaged in banking transactions where the scope of those transactions requires a commercially organised business enterprise.’ Banking transactions consist of any of the following (not all credit institutions would engage in the whole range of transactions):
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(i)
the receipt of monies from outside sources as deposits irrespective of the payment of interest (deposit business);
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(ii)
the granting of money loans and acceptance credits (credit business);
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(iii)
the purchase of bills and cheques (discount business);
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(iv)
the purchase and sale of securities for the account of others (securities business);
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(v)
the custody and administration of securities for the account of others (safe custody business);
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(vi)
the transactions set out in Article 1 of the Law on Investment Companies of April 16, 1957, as amended (investment fund business, which is confined to certain specialised institutions);
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(vii)
the incurring of obligations to acquire claims in respect of loans prior to their maturity;
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(viii)
the assumption of guarantees and other warranties for others (guarantee business); and
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(ix)
the carrying out of transfers and clearing transactions (giro business).
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Notes
Unless otherwise specified, references in this Chapter to Articles are to Articles in the Banking Law (Kreditwesengesetz — KWG) of July 10, 1961 (Federal Law Gazette I, p.881, as last amended by Article 72 of the Law to introduce the Tax Order of December 14, 1976 (Federal Law Gazette I, p.3341).
This does not apply to banks organised as sole proprietorships as at May 1976, which can take advantage of a five-year transitional period, allowing certain exemptions.
This does not apply to banks organised as sole proprietorships as at May 1976, which can take advantage of a five-year transitional period, allowing certain exemptions.
Bánks taking the form of an Einzelkaufmann, a KG or an OHG are called Privatbankiers (private banks).
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© 1981 Springer Science+Business Media Dordrecht
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Welch, J. (1981). Germany. In: Welch, J. (eds) The Regulation of Banks in the Member States of the EEC. Springer, Dordrecht. https://doi.org/10.1007/978-94-015-7639-0_4
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DOI: https://doi.org/10.1007/978-94-015-7639-0_4
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