In 2016, BaFin again received several thousand enquiries from journalists relating to its various areas of responsibility.

Fintech companies and Brexit

As in the previous year, there were many questions on fintech companies and their regulation. Matters of interest included what organisational arrangements BaFin has made to enable it to respond to the particular challenges posed by these companies.

In the wake of the referendum on the United Kingdom leaving the European Union ("Brexit"), BaFin received many enquiries on the consequences of Brexit for the British financial sector. Among other topics, journalists were interested to know under what circumstances British financial institutions would be permitted to conduct business with customers in other EU countries if they no longer had EU passporting rights. Other questions included whether any institutions had approached BaFin with a view to relocating to Germany yet and what supervisory requirements would apply to them in that event.

Basel and cum-ex transactions

The media also showed considerable interest in the investigations by BaFin's Banking Supervision Directorate into cum-ex transactions and the "Panama Papers". At the end of the year, the media focused increasingly on the negotiations being conducted by the Basel Committee on Banking Supervision (BCBS). The main topics of interest were the positions of the parties participating in the negotiations and the potential consequences for financial institutions.

Also at the end of the year, many journalists sought information on the revised version of the German Remuneration Ordinance for Institutions (Institutsvergütungsverordnung) since, among other things, it is expected to include mandatory provisions permitting variable components of remuneration already paid to be clawed back during a limited period of time.

Payment Accounts Act and whistleblowers

The provisions of the German Payment Accounts Act (Zahlungskontengesetz) relating to the basic payment account also generated a large number of press enquiries. Journalists sought information on the conditions under which an institution can decline to open an account and wanted to know whether any customers had yet lodged complaints.

The contact point for whistleblowers established by BaFin in 2016 also generated a significant reaction in the media. The principal question was how BaFin protects whistleblowers. Journalists also wanted to know how many reports had been received from whistleblowers and whether BaFin had already taken any action in response.

Low interest rates

As before, the low interest-rate environment and its effects on the life insurance industry are a major topic for the media too. Questions in 2016 focused in particular on the steadily growing size of the additional interest provision (Zinszusatzreserve – ZRR), as well as on the exemptions (recalibration) BaFin has been offering undertakings in this connection since 2015. BaFin also regularly received enquiries relating to the situation facing the Pensionskassen. Another significant topic for the press was the stress test imposed by the European Insurance and Occupational Pensions Authority (EIOPA). The stress test applies to European insurers and essentially confirmed BaFin's own estimations.

Solvency II

For BaFin's Insurance Supervision Directorate, 2016 was also significantly affected by the introduction of the new Solvency II supervisory regime. BaFin presented the first figures, including those relating to individual insurance classes, in the summer, generating a wide response in the media. Portfolio transfers also attracted greater attention in the media during 2016, especially in the light of BaFin's approval for the transfer of the Basler Leben portfolio to Frankfurter Leben.

Press enquiries were also concerned with the communications sent by life insurers to their customers informing them how their entitlements have performed during the most recent year. Criticisms made by consumer protection bodies included the claim that the annual statements of account provided by some undertakings were difficult to understand. A further topic debated in the press related to the increases in premiums for private health insurance expected to apply from 1 January 2017.

Product intervention

The announcement of BaFin's first product intervention measures, in particular the ban on the sale of credit-linked notes, as they were known, to retail investors that BaFin was considering, generated great interest in the media. Equally, the German and international press paid close attention to the voluntary undertaking by the industry at the end of 2016. In mid-December BaFin announced that it was planning to impose restrictions on the marketing, distribution and sale of contracts for difference (CFDs) in order to protect retail investors. Its view was that the sale to retail investors of contracts entailing an obligation to make additional payments should no longer be permitted in order to protect them from losses. Comments on the draft general administrative act could be submitted in writing until 20 January 2017.

Merger of Deutsche Börse/London Stock Exchange

The media also attached great importance to the proposed merger of Deutsche Börse with the London Stock Exchange. Public interest focused on BaFin's investigations into ad hoc disclosures and insider trading, in addition to the status of the takeover proceedings under the German Securities Acquisition and Takeover Act (Wertpapiererwerbs- und Übernahmegesetz).

Preparations for MiFID II

The markets and the media were equally preoccupied in 2016 with the question of when the European Markets in Financial Instruments Directive (MiFID II) would come into force, and what provisions it would contain. The ministerial draft bill for the Second Financial Markets Amendment Act (Zweites Finanzmarktnovellierungsgesetz), which was published at the end of September 2016 and transposes the directive into German law, was eagerly awaited. Questions received by BaFin from representatives of the press related mainly to the parallel provision of commission-based and fee-based investment advice, but also to how banks would be required to record orders placed by customers in future.