Notification & reporting requirements
In addition to institutions' annual reports, one of the banking supervisors' main sources of information is the audit reports which external auditors or audit associations produce as part of their auditing of the annual reports. In addition, institutions have to regularly file condensed balance sheets, from which the major balance sheet items, risk positions and changes thereto can be identified.
Institutions are also obliged to report major changes, such as net losses or changes in the management board, in their domestic and foreign branch networks or in holdings of more than 10%. They must also report their large exposures and loans of EUR 1m or more.
In addition to this, investment services enterprises, German central counterparties and subsidiaries under section 35b of the German Banking Act (Kreditwesengesetz – KWG) are obliged to notify BaFin of all on-exchange and off-exchange dealings in financial instruments such as securities and derivatives if they are admitted to trading on an organised market or a regulated unofficial market or if they are included in the regulated market of a German exchange. These trading data are necessary for BaFin to be able to supervise securities trading and detect breaches of the prohibition of insider trading and market manipulation, for instance.
Foreign trading participants
Non-German trading participants from non-European countries who carry out transactions on the basis of a trading licence for a German stock exchange are also subject to these reporting requirements. Non-German trading participants from within Europe must only report transactions carried out on the basis of an existing trading licence in financial instruments that are not admitted to trading on an organised market or on the regulated market of a German stock exchange.