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BaFin – Federal Financial Supervisory Authority

The financial regulator, BaFin monitors the different sectors of the financial markets in Germany. It's aim is ensure stability and integrity in the market.

BaFIN, – the German regulator Federal Financial Supervisory Authority oversees the financial markets in Germany. In Germany the regulator goes by the name Bundesanstalt für Finanzdienstleistungsaufsicht. According to the 2015 annual report of the German regulator, in 2014 BaFin had a total of 2,577 employees. The authority’s personnel spread over two cities, Bonn and Frankfurt am Main. Also, the regulator is not dependent of the federal budget. The regulator generates its income through fees, which the licensed market participants have to pay under BaFin’s authorisation.

BaFin duties and activities

The German regulator aims to guarantee that banks, financial services institutions and insurance undertakings are meeting their payment obligations. Furthermore, the regulator attempts to protect investors by preventing activities of unauthorized businesses and imposing standards of professional conduct. Also, it is good to look at the regulator’s mission statement, as it sums up nicely their objectives:

“To ensure and promote the proper functioning, stability and integrity of Germany as a financial centre. Within the context of European integration and international cooperation as well as to strengthen collective consumer protection through its regulatory actions.”

On a daily basis, BaFin is actively monitoring the activities of institutions, insurance undertakings, pension funds. But the regulator also oversees the activities of the domestic investment funds and asset management firms. Moreover, under BaFin’s supervision there are approximately 800 financial services, 2,700 banks and 700 insurance firms.

BaFin’s History

BaFin, history

BaFin got established on the 1st of May 2002, after three former supervisory agencies were merged into one regulator. As portrayed above, these three supervisory agencies were the Federal Banking Supervisory Office, the Federal Supervisory Office for the Securities Trading and the Federal Insurance Supervisory Office. The decision to merge into one regulator, came after the Financial Services and integration Act was passed in April 2002. The aim of the legislation was to create an integrated regulator in Germany that oversees all the Financial markets.