Lobbying by Die Deutsche Kreditwirtschaft

Die Deutsche Kreditwirtschaft

Die Deutsche Kreditwirtschaft represents Germany's five major banking associations on regulatory, policy, and payment system matters.

Focus Areas

2023-2025

2020-2022

2017-2019

Links

Website Transparency Register Profile

ID: 52646912360-95

Lobbying Activity

German banking industry demands simpler EU green finance rules

5 Dec 2025

Topic — Review of EU taxonomy environmental acts to simplify technical screening criteria.

Message — The group calls for reducing the complexity of assessment criteria to improve practical usability. They suggest waiving "Do No Significant Harm" checks for small transactions and retail loans.1 2

Why — Streamlined rules would lower compliance costs and avoid duplicate reporting for banking institutions.3 4

Impact — Human rights advocates lose specific taxonomy oversight if social safeguards are removed for European companies.5

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Meeting with René Repasi (Member of the European Parliament, Rapporteur)

7 Nov 2025 · Payment Services Proposals

German banking industry seeks improved rules for securitisation recognition

15 Jul 2025

Topic — Revision of bank liquidity requirements regarding the treatment of securitisation exposures.

Message — The group asks for senior STS and non-STS securitisations to be upgraded. They also want ABCP positions to be clearly included as eligible liquid assets.1 2

Why — A better framework would help banks remove obstacles and increase growth opportunities.3

Impact — Issuers of low-risk portfolios would face higher costs and new entry barriers.4

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Meeting with Marion Walsmann (Member of the European Parliament)

14 Jun 2025 · Omnibus I

Response to Quantum Strategy of the EU

2 Jun 2025

Quantum technologies (QT) will cause a massive transformation, particularly the financial sector. As the EU formulates its Quantum Strategy, it is imperative to strive for a frontrunner position in the global quantum race. To fall behind in the quantum race would mean the EU keeps on crawling, while other countries started teleporting, thus our computers would need months and years to solve a problem, while quantum computers need mere seconds. This advantage cannot be compensated by merely adding more conventional computers. This competitive edge can only be countered by using available Quantum technologies and in the long run developing European ones. Quantum technologies in the FS: Quantum technologies will create an enormous decrease in latency, which is the time data needs to be processed or to be transmitted from one point another. Banks run data-driven business models. They offer services and no tangible products, and their processes are digitized. A decreased latency will heavily transform all areas in a bank, capital markets, trading, fraud management, cyber security, financial risk modelling as well as all AI-based use cases. This is why the banking sector will experience a significantly greater impact, and a more profound transformation compared to most other sectors. By strategically investing in quantum initiatives, the financial sector can position itself at the forefront of innovation, ensuring resilience and competitiveness in the evolving digital landscape. However, this is only possible if scalable quantum computers are available for banks to use. In order for banks to start the quantum age as a frontrunner, we recommend the following: Research: Quantum technologies are still in a nascent stage, but breakthroughs are on the horizon. We must position the EU to facilitate such breakthroughs and secure a leading role. This includes leveraging research strengths and identifying industries that would benefit the most from QT in order to direct investments to these areas, e.g. the financial sector. Commercialization: Besides world-class research, it is imperative to transform breakthroughs into scalable products and support the growing commercial quantum sector. The EU must increase efforts to bridge the gap between theoretical potential and practical application and not let other countries take the frontrunner position as it did with AI or Cloud. Talent: There is a global shortage of experts for quantum technologies. The EU must invest in education and training programs to build a skilled workforce capable of leveraging these technologies, e.g. by increasing industry-academia collaboration to draw research talent into industry. Regulations: In 2024 not even 50% of all companies in the EU used AI, however, we already had a comprehensive law that regulates how we develop and use AI. In 2025, there are almost no companies that use products based on QT, but the EU already announced a Quantum Act. It is essential that the Quantum Act creates an innovative environment and legal certainty and does not cause the EU to fall behind the US and China in the quantum race. Before creating the Quantum Act, the EU should look at existing legislation to identify where it is inadequate for the adoption of QT, so that we focus exactly on the areas that lack a legal foundation. Then the Quantum Act should fulfil the following: - Enable the market to increase QT usage - Create a harmonized market and prevent EU-fragmentation - Ensure an equal level of knowledge in the continent - Allow flexibility in regulation to identify risks and mitigate those - Foster cross-EU collaboration in research and application This way, the EU can bring the continent to the forefront of the race.

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German Banking Industry calls for three sustainable product categories

28 May 2025

Topic — This consultation reviews EU sustainable finance disclosure rules to simplify frameworks and prevent greenwashing.

Message — The group proposes introducing three product categories: Sustainable, Transition, and ESG Basic. They request scrapping entity-level impact statements and reducing mandatory disclosure indicators to avoid investor information overload. They also advocate for shorter ESG templates and the removal of website disclosure requirements.1 2 3

Why — The industry would benefit from significantly reduced administrative complexity and lower regulatory compliance burdens.4

Impact — Investors lose access to comprehensive data on how financial firms handle broader sustainability risks.5

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Meeting with Michael Hager (Cabinet of Commissioner Valdis Dombrovskis)

15 Apr 2025 · Digital Euro

German banks urge suspension of EU taxonomy reporting obligations

26 Mar 2025

Topic — The consultation seeks to simplify environmental reporting rules and reduce data costs for companies.

Message — The group requests a temporary suspension of taxonomy reporting until a full review is finished. They want to remove specific reporting templates and simplify environmental harm assessment for loans. Supervisory rules must align with these changes to avoid duplicative data requests for clients.1 2 3

Why — This would save banks from expensive, recurring updates to their internal reporting systems.4

Impact — Regulators and investors lose access to detailed sustainability data during the proposed suspension period.5

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Meeting with Rasmus Andresen (Member of the European Parliament)

19 Feb 2025 · Omnibus

German banks urge unified EU rules for digital identity wallets

2 Jan 2025

Topic — The European Commission is setting rules for organizations to register and use digital identity wallets.

Message — The group calls for uniform EU-wide technical specifications to prevent fragmented national registration requirements. They request clearer rules for intermediaries and specific identification of data controllers during wallet access.1 2

Why — Harmonization would reduce complexity and operational costs for banks operating across multiple member states.3 4

Impact — Wallet users face increased fraud risks if registration models remain overly decentralized and inconsistent.5

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Response to Security breaches of European Digital Identity Wallets

2 Jan 2025

The German Banking Industry Committee (GBIC) welcomes the goal of setting up a harmonized framework for an interoperable european digital identity wallet under eIDAS 2.0. We would like to share our comments on the draft implementing acts proposed by the Commission. Please find our responses in the attached document.

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Response to Qualified electronic attestation of attributes under the EDIF

2 Jan 2025

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Response to Cross-border identity matching under the European Digital Identity Framework

2 Jan 2025

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Meeting with Matthias Ecke (Member of the European Parliament)

16 Oct 2024 · Finanzpolitik

German Banking Industry urges clearer standards for EU Digital Wallets

9 Sept 2024

Topic — Implementing rules for the technical integrity and functions of European Digital Identity Wallets.

Message — The group demands specific requirements to ensure technical and legal interoperability across Europe. They propose incorporating established technical definitions and allowing flexible transaction logging for users.1 2 3

Why — Uniform standards would eliminate the need for costly intermediaries and prevent national over-regulation.4

Impact — Technical intermediaries lose revenue if the EU eliminates the need for cross-border converters.5

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German Banking Industry Committee demands clearer digital wallet standards

9 Sept 2024

Topic — This consultation defines the technical protocols and interfaces for European Digital Identity Wallets.

Message — The group calls for more specific requirements to ensure seamless interoperability across Europe. They believe the rules should be better aligned with the existing reference framework.1 2

Why — Common European standards would help banks avoid the costs of using technical intermediaries.3

Impact — National regulators would be unable to enforce stricter safety or technical rules locally.4

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German banking industry urges standardized EU digital wallet data

9 Sept 2024

Topic — This consultation seeks rules for managing personal identification and attributes in digital wallets.

Message — The group demands uniform technical standards to prevent countries from imposing stricter national rules. They call for mandatory data sets to ensure secure EU-wide customer identification.1 2 3

Why — Standardization would allow banks to perform identity checks without using expensive intermediaries.4 5

Impact — Intermediary firms would lose revenue if cross-border data conversion services are no longer required.6

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German banking industry urges less bureaucratic and risk-based GDPR

7 Feb 2024

Topic — A review of the EU’s General Data Protection Regulation six years after its application.

Message — The committee proposes reducing detailed information requirements and bureaucratic documentation obligations. They also want to restrict data access rights to prevent misuse in non-privacy legal disputes.1 2

Why — This would reduce operational compliance costs and limit liability risks for financial institutions.3 4

Impact — Consumers could receive less transparent information and lose a tool for legal disputes.5 6

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Response to Reporting reduction package - amendments to the ESA, ESRB and InvestEU Regulations

19 Dec 2023

Dear Sir or Madam, Please find enclosed the comments of the German Banking Industry Committee on the consultation on the "Have your say" process regarding the Proposal for a REGULATION amending Regulations (EU) No 1092/2010, (EU) No 1093/2010, (EU) No 1094/2010, (EU) No 1095/2010 and (EU) 2021/523 as regards certain reporting requirements in the fields of financial services and investment support. Yours sincerely, on behalf of the German Banking Industry Committee, Dr. Olaf Achtelik

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German banks urge gradual rollout of EU open finance rules

26 Oct 2023

Topic — This consultation addresses the proposed framework for wider sharing of financial customer data.

Message — The committee advocates for a step-by-step approach and longer implementation deadlines to manage technical complexity. They also suggest alternative governance models to ensure more efficient decision-making within data sharing schemes.1 2 3

Why — A slower implementation timeline reduces immediate compliance costs and protects proprietary internal risk assessment models.4 5

Impact — Consumers may face increased security risks and the danger of receiving poor investment advice from third parties.6 7

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Response to Payment services – revision of EU rules (Directive)

25 Oct 2023

GBIC welcomes the opportunity, provided by the European Commission, to give feedback on this proposal for this Directive and contribute to the legislative debate. Please find attached our detailed comments and positions on the proposal. The German Banking Industry Committee (GBIC) is the joint committee operated by the central associations of the German banking industry. These associations are the Bundesverband der Deutschen Volksbanken und Raiffeisenbanken (BVR), for the cooperative banks, the Bundesverband deutscher Banken (BdB), for the private commercial banks, the Bundesverband Öffentlicher Banken Deutschlands (VÖB), for the public-sector banks, the Deutscher Sparkassen- und Giroverband (DSGV), for the savings banks finance group, and the Verband deutscher Pfandbriefbanken (vdp), for the Pfandbrief banks. National Association of German Cooperative Banks (BVR) on behalf of German Banking Industry Committee (GBIC)

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Response to Payment services – revision of EU rules (new Regulation)

25 Oct 2023

GBIC welcomes the opportunity, provided by the European Commission, to give feedback on this proposal for this Regulation and contribute to the legislative debate. Please find attached our detailed comments and positions on the proposal. The German Banking Industry Committee (GBIC) is the joint committee operated by the central associations of the German banking industry. These associations are the Bundesverband der Deutschen Volksbanken und Raiffeisenbanken (BVR), for the cooperative banks, the Bundesverband deutscher Banken (BdB), for the private commercial banks, the Bundesverband Öffentlicher Banken Deutschlands (VÖB), for the public-sector banks, the Deutscher Sparkassen- und Giroverband (DSGV), for the savings banks finance group, and the Verband deutscher Pfandbriefbanken (vdp), for the Pfandbrief banks. National Association of German Cooperative Banks (BVR) on behalf of German Banking Industry Committee (GBIC)

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Meeting with Joachim Schuster (Member of the European Parliament)

21 Sept 2023 · CMDI (on staff level)

Meeting with Stefan Berger (Member of the European Parliament, Rapporteur) and Deutscher Sparkassen-und Giroverband

20 Sept 2023 · Digital Euro

German banking industry criticizes EU withholding tax relief proposal

18 Sept 2023

Topic — This initiative proposes introducing a common, standardised, EU-wide system for withholding tax relief.

Message — The group opposes mandatory registration for all large banks and demands protection from liability for errors made by clients. They also call for a longer implementation period and the right to charge for refund services.1 2 3

Why — These changes would protect banks from high compliance costs and legal liability for client errors.4 5

Impact — National governments may lose tax revenue if standardized definitions are not strictly applied across borders.6

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Response to Banking Union: Review of the bank crisis management and deposit insurance framework (SRMR review)

30 Aug 2023

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Response to Banking Union: Review of the bank crisis management and deposit insurance framework (DGSD review)

30 Aug 2023

The German Banking Industry Committee (GBIC) welcomes the goal of improving crisis management for credit institutions. However, the changes proposed by the European Commission would considerably impair the performance of the well-established national deposit-based guarantee schemes and call into question the structure of the German banking market. The legislative proposal is therefore rejected in its entirety. A detailed reasoning is attached to this feedback. Briefly summarized: 1) The GBIC rejects the inclusion of medium-sized and smaller institutions in the resolution regime. Resolution instruments were designed primarily for systemically important institutions and are not suitable for small and medium-sized institutions. In any case, a failure of such institutions generally has no impact on financial stability. Furthermore, just the participation in the planning of a resolution as well as an excessive resolution reporting involves high administrative and financial burdens, which are disproportionate for small and medium-sized institutions. 2) Additionally, the GBIC rejects the extension of the co-financing of resolutions by Deposit Guarantee Schemes (DGS). In a worst-case scenario, all the funds gathered by the DGS would have to be used for resolution financing and re-accumulated again within six years at the latest. Inevitably, subsequent increases in contributions jeopardise the competitiveness of the institutions. In the event of the need to levy unforeseeable special contributions, these further reduce earnings and have an impact on competitiveness as well as financial stability. If resolution measures co-financed by a DGS fail, the DGS must also finance compensation payouts to depositors. 3) Likewise, we are against the idea to abolish the priority of claims of DGS that have taken over the rights and obligations of covered depositors in the event of insolvency or have compensated depositors (so-called "super preference") in favour of a general deposit preference. The equal treatment of all deposits means that DGS receive significantly lower returns in insolvency proceedings, which leads to proportionately higher losses in the event of compensation. As a result, funding gaps must be closed by higher regular contributions from the credit institutions. There is a risk of a considerable weakening of the credibility of the financing combined with the loss of depositor confidence in the DGS or the security of deposits as a whole. 4) Finally, it is to be criticized that the European Commission's proposals link additional requirements to alternative private measures by the DGS to avert a (looming) default. The actual possibility of exercising alternative private as well as preventive measures through national DGS and Institutional Protection Schemes (IPS) is severely restricted by the proposals and their proven benefits for financial stability and the preservation of depositor confidence negated. Against this backdrop, the GBIC advocates, in compliance with the principles of transparency and equal treatment, i.e. also taking into account other supervisory approval procedures, in particular those according to Article 113 (7) CRR, for regulations that enable the use of preventive measures by DGS and do not restrict IPS in the exercise of their mandate.

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Response to Retail Investment Package

28 Aug 2023

The German Banking Industry Committee (GBIC) supports the European Commissions intention to use the retail investment strategy (RIS), developed as part of the capital markets union, to make the securities business more consumer-friendly and thereby encourage retail investors to invest in EU capital markets. However, the European Commission has presented a proposal which cannot achieve most of these aims and may even work to counter them. While the European Commission has rightly opposed a complete ban on inducements, its proposal raises other concerns: The RIS would not only lead to more and more complex regulation, it would also make participation in the securities business more difficult, particularly for those clients that are supposed to be guided towards the capital markets. The RIS would lead to higher costs, which clients would ultimately have to pay for. The RIS contains some elements that are close to price regulation. The RIS would lead to a limitation on the range of products offered in investment advice and would influence the market. The RIS remains vague on many requirements, thus deferring key political decisions to delegated acts to be issued by the European Commission (Level 2) or to the European Securities and Markets Authority, ESMA (Level 3). For details regarding the proposed amendments of the European Markets in Financial Instruments Directive (MiFID) in the course of the RIS, please see the attached document.

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Response to Banking Union: Review of the bank crisis management and deposit insurance framework (DGSD review)

24 Aug 2023

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Response to Banking Union: clarifications to the daisy chain deductions

14 Jul 2023

On 18 April 2023, the European Commission's published a proposal for a Directive of the European Parliament and of the Council amending Directive 2014/59/EU and Regulation (EU) No 806/2014 as regards certain aspects of the minimum requirement for own funds and eligible liabilities (COM(2023) 229 final, connotated as proposed amendments to the "Daisy Chain Act"). The German Banking Industry Committee (GBIC) generally welcomes the suggested improvements relating to internal MREL requirements and the treatment of liquidation entities. Note: This comment focuses on the proposed amendments to the Daisy Chain Act. This proposal is part of the European Commission's comprehensive legislative package on crisis management and deposit insurance (CMDI) which also includes further amendments to the Single Resolution Mechanism Regulation (SRMR), the Bank Recovery and Resolution Directive (BRRD) and the Deposit Guarantee Schemes Directive (DGSD). These proposals will be dealt with in separate position papers, which will be made available under the respective "Have your say" process. A holistic critical review of the entire CMDI legislative package is available on the GBIC website (https://die-dk.de/en/topics/article/dk-opinion-cmdi-legislative-package-european-commission/). As an overall evaluation of the proposed amendments to the Daisy Chain Act, the GBIC welcomes the initiative of the European Commission to contribute to the resolvability of banks by improving the functioning and proportionality of the deduction mechanism in relation to liquidation entities. In particular, the GBIC appreciates the suggested general removal of additional MREL-requirements for liquidation entities beyond own funds requirements. It is likewise welcomed that prior authorisation requirements under Article 77(2) and Article 78a CRR shall not apply to liquidation entities for which the resolution authority has not set separate MREL requirements. This acknowledges that such authorisation would not add any benefit, but only meaningless burden for both the respective entity and the resolution authority.

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German banking industry urges mandatory climate data in reporting

6 Jul 2023

Topic — The EU is establishing uniform sustainability reporting standards for large and listed companies.

Message — The GBIC requests that climate data and indicators remain mandatory regardless of materiality assessments. They also seek exemptions for certain financial vehicles and more time to gather data.1 2 3

Why — This ensures banks receive the specific data required to fulfill their own regulatory obligations.4

Impact — Environmental transparency decreases if companies are permitted to omit reporting on net emission targets.5

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German banking industry urges one-year delay for taxonomy reporting

3 May 2023

Topic — The initiative establishes a classification system for sustainable economic activities contributing to four environmental objectives.

Message — The organization requests postponing all new reporting requirements by one year to ensure sufficient implementation time. They also propose correcting application dates to maintain consistent reporting across the European Union.1 2

Why — A delay would reduce compliance pressure and prevent banks from being overburdened by complex standards.3 4

Impact — Sustainability-focused investors lose timely access to standardized data on new environmental objectives.5

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Response to VAT in the Digital Age

3 Apr 2023

Please find attached the feedback and comments of The German Banking Industry Committee.

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German banks urge removal of non-strategic benchmarks from BMR

28 Mar 2023

Topic — Review of EU rules for financial benchmarks and access to third-country benchmarks.

Message — The organization supports a general removal of non-significant and non-strategic benchmarks from the regulation's scope. They also call for the transitional period to be extended until December 2025.1 2

Why — This would preserve the competitive strength of EU banks in international markets.3

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Response to Facilitating small and medium sized enterprises’ access to capital

24 Mar 2023

The German Banking Industry Committee (GBIC) welcomes the opportunity to provide its view on the European Commissions proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending Regulations (EU) 2017/1129, (EU) No 596/2014 and (EU) No 600/2014 to make public capital markets in the Union more attractive for companies and to facilitate access to capital for small and medium-sized enterprises (Listing Act). In general, GBIC welcomes the proposed amendments to the Prospectus Regulation ((EU) 2017/1129, PR) and to the Market Abuse Regulation ((EU) No 596/2014, MAR) to reduce administrative burdens for all issuers (not only for SMEs). However, to promote the European public market and increase its attractiveness further improvements are necessary in the context of the Capital Markets Union. Please find our comments attached.

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Meeting with John Berrigan (Director-General Financial Stability, Financial Services and Capital Markets Union) and Bundesverband deutscher Banken e.V. and

21 Mar 2023 · CMDI, Digital Euro

Response to Enhancing the convergence of insolvency laws

16 Mar 2023

Please find our comments attached.

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German banks urge flexible approach to EU clearing requirements

17 Feb 2023

Topic — Revising rules for central counterparties to increase the EU's clearing attractiveness.

Message — The group requests a two-stage system based on qualitative criteria without quantitative targets. Market making activities should be disregarded when calculating proportions to safeguard international competitiveness.1 2

Why — This would prevent forced relocation of business and protect their position in international markets.3 4

Impact — Non-EU clients lose out because EU clearers cannot serve multi-currency portfolios with sufficient liquidity.5

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Response to EMIR Targeted review

17 Feb 2023

The German Banking Industry Committee continues to support the European Commissions (COM) initiative to increase the attractiveness and resilience of the EU clearing landscape and therefore generally supports the package of measures set out in the proposals for a regulation amending Regulations 648/2021 (EMIR), 575/2013 (CRR) and 2017/1131 (MMFR) - hereinafter referred to as the Amending Regulation, and a Directive amending the Directives 2009/65 (UCITD), 2013/36 (CRD) and 2019/2034 (IFD) - hereinafter referred to as Amending Directive. Further details of our opinion can be found in the attached document.

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Response to Instant Payments

4 Jan 2023

GBIC welcomes the opportunity, provided by the European Commission, to give feedback on this proposal for a Regulation and contribute to the legislative debate. Please find attached our detailed comments and positions on the proposal.

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German Banking Committee warns AI liability rules stifle innovation

28 Nov 2022

Topic — This consultation proposes new EU rules for civil liability regarding artificial intelligence damage.

Message — The group urges the EU to narrow the definition of AI and allow national flexibility. They also warn that proposed evidence disclosure rules lack protections against abusive litigation.1 2

Why — Avoiding new liability rules helps banks maintain current legal protections and lower costs.3 4

Impact — Consumers may pay higher prices and lack uniform protection if definitions remain vague.5 6

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Meeting with René Repasi (Member of the European Parliament, Rapporteur for opinion)

27 Oct 2022 · Arbeitsfrühstück zum EU-Lieferkettengesetz (CSDD)

Meeting with Joachim Schuster (Member of the European Parliament)

27 Oct 2022 · Banking package

Response to Open finance framework

2 Aug 2022

The German Banking Industry Committee (GBIC) welcomes the opportunity to respond to the call for evidence on the European Commission’s open finance framework initiative. The following comments supplement our response to the Commission’s targeted consultation on 5 July 2022. We support the European Commission’s aim of using its data strategy and open finance framework to seize the opportunities of the data economy for the good of European consumers and businesses and the economy as a whole. Users of financial services can benefit from greater availability and accessibility of data as this will make it easier to tailor products and services to a customer’s individual needs and to speed up customer processes. This applies to consumers and corporate customers alike. Appropriate framework conditions that facilitate and promote the access to, and exchange of, data among the various parties involved both within the private sector and in dealings with the state will help to achieve this goal. Better access to relevant data will enable innovation and value creation. But sector-specific approaches will not go far enough to effectively exploit the obvious potential. Service providers along the entire value chain need better access to data to better understand and satisfy customer needs, also with respect to financial products and services. This will usually include data from very different application areas and industry contexts. Financial data alone do not fully reflect the financial concerns of today’s consumers: data from sources such as energy providers, mobility providers, commerce and industry are also required to generate added value for customers and keep pace with global platform providers. Sectoral approaches, such as those that the open finance framework intends to pursue, risk fragmenting framework conditions with the result that competitive imbalances will be maintained or even exacerbated and an integrated data economy with equal opportunities for all will not be achieved. Sector-specific framework conditions should therefore be the exception and should only be considered where they are absolutely necessary. In the interests of equal opportunities and a coherent overall strategy, it is important to establish a consistent regime across the various economic sectors with the same data access rights and associated conditions applicable for all involved. Otherwise, a European regulatory jungle threatens that does not follow standardised principles and where differing sectoral rules and regulations perpetuate existing imbalances. A data-based financial system must therefore go hand in hand with the opening up of data in other sectors as well so that a balance of costs and benefits can be achieved for all parties. We refer to the attached comments for further information.

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Response to Distance Marketing of Consumer Financial Services - Review of EU rules

8 Jul 2022

The German Banking Industry Committee (GBIC) shares the objective of offering European consumers a high level of consumer protection and a wide choice of products that meet their needs. Our main concerns relate to the scope in article 1 (need to exclude promotional loans to consumers and to exempt digital formats that are equivalent to face-to-face business), the provision of pre-contractual information (no overloading of the consumer with pre-contractual information, need to align the pre-contractual information obligations in distance-selling and product-specific EU legislation, to draft Article 16a(4) more precisely), consumer’s right of withdrawal under Articles 16b and 16c (exceptions to the right of withdrawal envisaged in the Commission proposal are imperative, shortcomings in the European Commission’s approach to regulating the right of withdrawal and clarification of the product-specific priority of application in the area of the Mortgage Credit Directive (2014/17/ЕU)) as well as a call for no application of the product-specific explanatory regime of the EU Mortgage Credit Directive to financial services that are marketed at a distance but not regulated under EU law. Please find our specific comments on the proposal issued by the European Commission are set out in the document attached.

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Meeting with Othmar Karas (Member of the European Parliament, Shadow rapporteur)

28 Jun 2022 · Reform der EU-Bankenregulierung (CRR3/CRD6)

Response to Retail Investment Package

27 May 2022

We appreciate to have the opportunity to share our comments how to increase consumer participation in capital markets. GBIC is convinced that consumer participation can only be enhanced when clients are able to choose between commission-based and fee-based advice. Therefore, the GBIC is strictly against a ban of inducements. This would lead to an advisory gap and a decline in retail investor participation in the capital markets. This is inter alia shown by a recent study by KPMG for the German market (attached). Another big issue for investors is the current information overload. The flood of information introduced under MiFID II still overwhelms clients and sometimes scares off consumers from investing in capital markets. It has been evidenced across studies and surveys in the EU that the majority of clients find the mandatory information overwhelming, with most choosing not to read the documents thoroughly. To empower retail investors to join the capital market it is important to drop documents that receive unnecessary information to them and to avoid having different documents with the same information included. Furthermore, retail Investors are faced with inconsistent rules across legal frameworks which lead to confusion and may also scare off consumers from investing in capital markets. For example, it is confusing for them to receive some information electronically and other in paper within one advice session or when purchasing the same instrument. The priority of electronic communication introduced under the MiFID quick fix should be extended to other legal provisions such as the PRIIPs Regulation. Hence, the requirements on the provision of information should be harmonised as well as the provisions for the disclosure of product costs under MiFID II and PRIIPs and the different definitions of sustainable products under MiFID II and SFDR. In addition, a significant reduction of requirements for classifying an investor with the highest level of protection (retail client) as an elective professional client should be considered to give more investors the opportunity for self-determination. This would continue to provide sufficient protection of retail or inexperienced investors, since only experienced investors could take advantage of this facilitation. MiFID II has introduced comprehensive product governance requirements for both manufacturers and distributors. These requirements have, in general, further increased investor protection. However, for many simple products the existing rules have also increased complexity and let to a limited range of products which could be offered to clients in advisory sessions. This was especially the case for bonds from the corporate sector, but also for other plain vanilla products. This contradicts the Capital Markets Union Action Plan from the EU Commission which aims to attract more investors to the capital markets. The MiFID quick fix has introduced helpful alleviations with respect to bonds with make-whole clauses and financial instruments distributed only to eligible counterparties. The legislator should take further steps in this direction and provide for an explicit exemption for plain vanilla bonds from product governance requirements. Attachement GBIC investor protection priorities for the upcoming MiFID Review Maintaining equal opportunities in private asset formation – a plea for commission-based advice KPMG The future of advice - A comparison of fee-based and commission-based advice from the perspective of retail clients

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Response to Central securities depositories – review of EU rules

26 May 2022

GBIC welcomes that mandatory buy-ins (MBI) should not initially apply. Buy-ins intend to protect buyers and therefore belong at trading level. A buyer has a right under national law to claim damages including buy-in costs from a failing contractual party. But it would neither be proportionate nor adequate to oblige all aggrieved buyers always to make use of their right to procure the securities elsewhere. We welcome the clarification in Art 1(2)(a) that penalties should not be imposed in certain cases. This avoids penalties for events which are not the target of the settlement discipline regime like for corporate actions, EU sanctions or collateral/primary market transactions. We also welcome ESMA’s task of specifying the details of these cases, Art 1(2)(j). ESMA should be mandated to draw up a clear and exhaustive list of the financial instruments covered by the scope of Art 7 CSDR and to specify which market values of these instruments should be used for calculating penalties and buy-in cash compensation. This “golden source” is urgently needed since there is legal uncertainty as to which instruments are subject to settlement discipline and the behaviour of CSDs across the EU is inconsistent and untransparent as a result. An additional provision should be added to Art 1(2) mandating ESMA to establish a list of this kind. Art 1(2)(b) permits the Commission to introduce MBI if certain conditions are met. When assessing whether MBI are a proportionate means, we believe that all of the three conditions outlined in Art 7(2a)(a) to (c) CSDR should be met. Given the possible adverse effects on market activity, liquidity and the competitiveness of EU capital markets, the decision on MBI should be based on a thorough analysis. ESMA should be closely involved in this decision. Art 7(2a) CSDR should therefore stipulate to involve ESMA when examining the conditions of Art 7(2a)(a) to (c) CSDR. The Commission may only take a decision to introduce MBI on the basis of ESMA’s reports and proposals if ESMA and the Commission conclude that such measures “constitute a proportionate means”. Hence, the prior technical advice of ESMA (including a cost-benefit analysis and market consultation) should be mandatory. As a buyer-protection, MBI belong at trading level. This is why Del Reg (EU) 2018/1229 makes trading parties responsible for initiating MBI. Should further transactions take place at trading level, it may be desirable to carry out only one MBI rather than a series. This “pass-on mechanism” is addressed in Del Reg. The wording for Art 7(3a) CSDR describes, however, the settlement, and not the trading, chain. This would have undesired consequences. Art 1(2)(d) should therefore be deleted or Art 7(3a) CSDR could stipulate that, in the event of a chain of trades, the MBI may be coordinated with one another. Art 1(2)(f) is either intended to correct an error that has already been corrected by Art 35(2) Del Reg and thus requires no further adjustment. Or a clause regularly used in contractual agreements should be established as a statutory principle which would be at odds both with national rules on damages and with the interests of the aggrieved buyer. Therefore, Art 1(2)(f) needs to be deleted. There is no need for a legal requirement to grant an advantage to a defaulting seller. Nothing would prevent a contractual agreement between the parties specifying that the buyer should pay the agreed purchase price even in the event of non-delivery. A legal requirement of this kind could, however, open the door to undesirable business models or encourage undesirable behaviour: a defaulting party would have little incentive to deliver financial instruments in the event of “favourable” price developments. Not only would the loss be limited, but it could even turn into a profit. The injured party, on the other hand, would not be allowed to benefit from favourable developments. More details please see attached.

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German banks urge narrower scope for EU supply chain law

23 May 2022

Topic — EU directive requiring corporate due diligence on human rights and environmental impacts.

Message — The industry requests limiting the directive's scope to firms with over 1,000 employees and restricting due diligence obligations to direct clients rather than entire value chains. They want one-time checks before lending rather than ongoing monitoring, and removal of civil liability provisions.1 2 3 4

Why — This would reduce compliance burdens for smaller institutions and limit liability exposure.5 6

Impact — Workers and communities in supply chains lose protections as banks limit monitoring responsibilities.7

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German banking committee urges broader data access and compensation

13 May 2022

Topic — Regulation to facilitate data access and sharing between businesses and consumers.

Message — The committee wants the Data Act to cover more than machine-generated data. Banks should receive fair compensation for providing access to customer data. They request longer timelines for switching between data processing service providers.1 2 3

Why — Broader data access allows banks to offer new customer-focused lending products.4

Impact — Tech giants lose market power as they are excluded from accessing data.5

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Response to Amendments to certain Directives regulating public financial and non-financial disclosure in order to establish the ESAP

29 Mar 2022

Please find attached the comments of the German Banking Industry Committee.

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Meeting with Danuta Maria Hübner (Member of the European Parliament, Rapporteur)

3 Mar 2022 · MiFIR Review

Response to Mortgage credit – review of EU rules

28 Feb 2022

The German Banking Industry Committee (GBIC) welcomes the opportunity to participate both in the public consultation and the call for evidence concerning the review of the Mortgage Credit Directive (MCD) by the European Commission and to provide an opinion on said directive. In our view, the provisions of the Mortgage Credit Directive essentially remain suitable for ensuring a high level of consumer protection in the mortgage credit sector. The mortgage credit market is highly competitive and offers consumers a wide variety of products and providers. Where changes in the market – especially in connection with digitalization – or practical experience necessitate adjustments to the directive, such adjustments should be made in a careful and targeted manner. This process should primarily be guided by pragmatic consumer protection considerations. Any reconsideration of the requirements in relation to advertising materials and mandatory content of pre-contractual information must be directed towards scaling back the scope and level of detail to an extent that is manageable for the average educated and informed consumer. The content of credit agreements should also be streamlined, though we do not consider a model credit agreement to be a viable concept. The requirements for the creditworthiness assessment have proven fit for purpose and do not need to be amended. The same is true for the provisions concerning credit registers. A time limit should be implemented for the right of withdrawal. A standard form containing information about the right of withdrawal should be incorporated into the directive. Adjustments to the rules on the digital distribution of financial products in the area of mortgage credit are also required. These should include both streamlining the aforementioned mandatory information and making text form the standard requirement for concluding a credit agreement without allowing Member States to exceed this requirement e.g. by requiring a written or a qualified electronic signature. For detailed comments, please see the document attached.

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Response to Review of the regulatory framework for investment firms and market operators (MiFID 2.1)

21 Feb 2022

I. Deletion of Art. 27 (3) MiFID II The German Banking Industry Committee (GBIC) welcomes the European Commission (EC) legislative proposal dated 25th November 2021 to delete Article 27 (3) MiFID II (RTS 27 reporting). GBIC shares the view of the EC that the RTS 27 reporting provides almost no added value to investors and the public. The decision to abolish the requirements of Art. 27 (3) MiFID II permanently from the level 1 text is, therefore, consistent and enables our members to focus on fulfilling the best execution requirements for client orders per se. We, therefore, fully support the recent proposal and would recommend that the temporary suspension introduced by MiFID Quick Fix is extended until the current proposal has been adopted by the European Parliament and the Council and has entered into force. II. Deletion of Art. 27 (6) MiFID II From GBICs perspective the same reasoning as for the deletion of Art. 27 (3) also applies to Art. 27 (6) MiFID. We do not think that the reporting according to Art. 27 (6) provides meaningful information especially for the retail investor which would justify the efforts in producing these reports. We could not observe any significant use of these reports by customers and therefore consider the market relevance of the reports very low (att). Relevance of the RTS 28 reports is apparently for regulatory purposes only and we are convinced that modifications currently being discussed for RTS 28 will not lead to any change in this evaluation. Hence, based on the evidence we have so far, these reports are seldom used by clients and there is no demand on the investors’ side for them. Therefore, the RTS 28 reports should also be abolished. Furthermore, GBIC does not assume that these reports will achieve a higher level of discipline in the market with regard to complying with the best execution requirements. Such discipline is ensured by the supervision of the competent authorities, but not by basically useless reporting requirements with no benefit for an average retail investor. From an EC perspective benefits for the retail investor in terms of best execution information will result in the future from the Consolidated Tape (CT). Among the data that the CT is expected to provide are post-trade information regarding all transactions in financial instruments. Securities brokers and broker-dealers are responsible for providing best execution, which primarily means achieving the most advantageous transaction in terms of price and the lowest total explicit and implicit costs to (retail) investors. So far, the absence of a consolidated view of all trading markets is a problem when a financial instrument is made available for trading not just on a single listing venue, but across several competing venues. In principle, an investor has the choice between competing venues. The EC expects that the CT will help investors to have sufficient access to consolidated and comparable market data so that they can compare whether they would have obtained better execution conditions on an alternative platform. This means, that the data contained in the CT alone will enable (retail) investors to hold their securities brokers and broker-dealers accountable on whether they achieved the best execution for any given trading order. As a result, there will be no need for any additional yearly reports by investment firms on their TOP 5 execution venues or the quality of execution obtained. As the UK (FCA) will delete RTS 27/28 (https://www.fca.org.uk/publication/policy/ps21-20.pdf), we believe that there will be a serious competitive disadvantage for EU institutions if this obligation is maintained. It should be noted that this is not a matter of trying to compete with each other by reducing the level of investor protection (race to the bottom). It is about a well-thought-out deletion of such requirements which, at a proportionally high cost, bring no benefit to the investor and unnecessarily bind resources.

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Response to Review of the regulatory framework for investment firms and market operators (MiFIR 2.1)

31 Jan 2022

The German Banking Industry Committee welcomes the opportunity to comment on the legislative proposals dated 25 November 2021 for a revised MiFIR Regulation (MiFIR). The current review offers an excellent opportunity to further optimise cross-border capital market integration and to booster the competitiveness of the EU27 financial marketplace. The EU27 regime should naturally continue to meet high standards; but this target could also be met with fewer and less detailed rules. Both supervisors and supervised market participants should be relieved of requirements that generate unnecessary bureaucracy and costs. The review of MiFIR offers an excellent opportunity to achieve this. 1. Market Transparency Bonds A bilateral transaction concluded directly between investment firm and investor is the traditional form of bond trading. Since this way of trading is associated with risks for the investment firm, only an appropriate level of transparency ensures market efficiency and can help to maintain an equilibrium between supply and demand. It will be important, therefore, to strike the right balance between transparency and market efficiency. Too much market transparency in bond trading can make it impossible for investment firms to hedge the associated risk. This, in turn, has the effect of increasing the risk of liquidity being withdrawn from the market, thus decreasing the opportunities for investors to sell bonds from their portfolio on the secondary market, if necessary. The possibility to defer post-trade transparency is therefore essential. While leaving the precise design of deferred post-trade transparency to national competent authorities (NCAs) has not proved successful, the legislative proposal of the Commission to change this is neither clear-cut nor sufficient. We consider “ICMA’s proposal for a new post-trade transparency regime for the EU corporate bond market” suitable to achieve the much wanted market-sensitive harmonised rules across the EU. ICMA’s proposal has the merit of i) being clear-cut, ii) being practicable and iii) representing an excellent compromise of – naturally – diverging views of the sell-side and the buy-side. Against this backdrop, we ask for a wording of Article 11 which would be suitable to incorporate the market-sensitive proposal of ICMA, including increasing the deferral period for both price and volume publication to a maximum of four weeks and introducing the amount outstanding as a proxy for liquidity determination. 2. Consolidated Tape From a market perspective, it is imperative to establish a tape for equity data first. This asset class contains the most liquid instruments that are traded most frequently. Equity trading data is as important for institutional investors as it is for retail investors. This demand for data should be satisfied as a priority. Guaranteed high-quality data are therefore the key to the success of a CT. The supply, processing and dissemination of the data must meet highest quality standards. The quality assurance systems of the CT must be totally reliable to guarantee data excellence and dependable retrievability at all times. Moreover, it will be of utmost importance to ensure the same harmonised data format will be used for tape data and market transparency alike. Moreover, any sensible participation concept should ensure that all contributors are included in an objective and meaningful way. Such concept should ensure that all market data contributors get the chance to adequately participate in any distribution of revenues, be they large or small investment firms or large or small trading venues.

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Response to Alignment of EU rules on capital requirements to international standards (review processes)

21 Dec 2021

• Fit and Proper: We urge for deletion of Article 91a to 91d. At least, we require the following changes. Any ex ante-assessment procedure of members of the supervisory board carried out by the institutions themselves or by the competent authorities would be unfeasible to comply with for such institutions which – due to existing legal requirements - have practically no influence on the recruitment process of members of the supervisory board. For some institutions any internal assessment of supervisory board members would contravene national law. For these cases an exemption is needed. The supervisory assessment period of up to 6 months would lead to problems in the recruitment process. To avoid long vacancies it should be shortened to 1 or 2 months. The requirements of immediate replacement must be revised. The information on the renewal of members represent a disproportionate administrative burden. Applying suitability standards comparable to those for managing directors to key function holders would be disproportionate. • Remuneration: In regard to more proportionality the CRD VI provides an opportunity to further reduce administrative regulatory burdens for SNCIs. We therefore pledge for an exemption of SNCIs from the remuneration rules. Furthermore Article 92 (2)(f) requires a direct monitoring of the compensation of "senior staff in the internal control functions". In some member states, national law requires two-tier board structures, so the supervisory board and its Remuneration Committee have no decision-making power regarding the remuneration (amounts) of staff members who are not part of the management board. In case of two-tier-structures we suggest to replace “senior staff in the internal control function” by “heads of the internal control functions”. • ESG risks, Art. 73: According to the EBA’s report on management and supervision of ESG risks (EBA/REP/2021/18), these risks represent factors that materialise through the traditional categories of financial risks (e.g. credit risks). Therefore, ESG risks should not be treated as a separate risk category, but as a risk driver within the framework for existing risk types. Due to some requirements (e.g. to hold internal capital explicitly for ESG risks; Art. 73), this principle does not seem to be sufficiently clearly anchored in the draft. • SREP, Art. 73 (1), 74 (1) and 76 (2): Strategies and processes to assess and maintain internal capital now refer to all risks to which institutions are or might be exposed in the short-, medium- and long-term time horizon. While these time horizons are appropriate and necessary for strategies on climate risks, introducing those diverse time horizons for all risks would be unnecessary and counterproductive. We propose to skip the specification of the time horizon or at least to restrict it to climate risks. • ESG-risks, Art. 76 (2), 87a (4/5), 104 (1) m: The requirement for banking supervisory authorities to examine the progress made to align the institution’s business models to relevant policy objectives of the Union or broader transition trends towards a sustainable economy is too far-reaching. The specifications do not allow for a legally secure interpretation. Such a proposal is outside the scope of the current mandate of banking supervision. Responsibility for the business strategy and a viable business model must primarily lay with the institution's management body. • Stresstests, Art. 100 (3): The proposed ban on institutions, advisors and third parties to refrain from benchmarking, the exchange of information etc. in the context of supervisory stress tests should be omitted. The exchange between the banks and via the associations promotes a high quality and enables conceptual further development. • Adjustment of P2R /Outputfloor (OF): We welcome the new Art. 104a (6) and (7) with the intention to mitigate the impact of the OF on P2R. Though the article should also address the overcapitalisation of risks.

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Response to Alignment EU rules on capital requirements to international standards (prudential requirements and market discipline)

21 Dec 2021

The German Banking Industry Committee welcomes in principle the legislative proposal published on 27 October 2021 by the European Commission, the so-called Banking Package 2021, to implement the final elements of the Basel III reforms in the EU regulatory framework. The EU Commission's proposal for the implementation of the output floor is recognisably characterised by the intention to reduce the negative effects of the output floor on institutions. This is mostly notable in the solutions addressing European specifics like unrated corporates, low risk housing markets and the need to hedge exports. These however are only temporary and therefore only postpone the significant impacts. We therefore propose to make these solutions permanent. From our point of view, comparable solutions must also be granted to institutions using the CRSA or the SA-CCR. Otherwise, the implementation of a single stack approach of the output floor is likely to lead to a significant increase in capital requirements in the long-term. For sake of simplicity we therefore strongly advocate implementing the output floor within the framework of a parallel stacks approach and applying it only to those capital requirements explicitly mentioned by the Basel Committee. The new rules imply a huge implementation burden for all institutions due to massive procedural changes. Institutions must implement the new rules entirely before 2025, requiring huge investments in IT-implementation and internal processing (esp. real estate). Smaller institutions are disproportionately burdened. Therefore we strongly pledge for introducing an implementation period of at least 24 months after coming into force. Furthermore, the overall package lacks a sufficiently proportional design of the rules. In order to reduce administrative expenses within the framework, SNCIs should be exempted from further ESG reporting obligations, new disclosure requirements (esp. ESG) and the remuneration framework. Moreover, the draft regulation contains numerous mandates for the EBA to elaborate technical standards, guidelines and submit reports. We advocate a much stronger delegation of rulemaking to level 1 and ask for a thorough review of the mandates aiming at a reduction of EBA mandates. Additionally, the following topics require amendments: • Commercial real estate: Risk-weighting of commercial real estate exposures in the CRSA is still not risk sensitive enough. As a consequence, comparable provisions to the output floor rules concerning low-risk residential real estate should also be applied to low-risk commercial real estate in order to mitigate the effects of the output floor. The ADC provisions concerning residential real estate should also be applied to commercial real estate and the necessary investments in the sustainable refurbishment of commercial real estate should be better reflected since they actually increase value and thus reduce risk. • Equity: We welcome that the EU proposals differentiate more strongly than the Basel standard in the regulatory treatment of participations according to whether they are made for strategic, long-term considerations; however, more granularity is needed here. The longer an equity investment is held, the lower the risk weighting should be. • Unconditionally cancellable commitments and trade finance products: In our view, all unconditionally cancellable commitments should remain exempted from the capital adequacy requirement. The transitional arrangements are not sufficient. Due to the low risk of trade finance products the current credit conversion factors should be maintained and the effective maturity applied the Foundation-IRBA. • Other collateral: Other collateral that is eligible under the Foundation-IRBA should be eligible under the CRSA as well. There is no justification for a different treatment, if all requirements are equally met. A change of rules would have a positive effect on the financing of SMEs.

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Meeting with Othmar Karas (Member of the European Parliament, Shadow rapporteur)

9 Dec 2021 · Reform der EU-Bankenregulierung (CRR3/CRD6)

Meeting with Axel Voss (Member of the European Parliament)

2 Dec 2021 · Data Strategy

Response to Revision of EU rules on Anti-Money Laundering (recast of a former instrument)

29 Nov 2021

General: From the point of view of the German Banking Industry Committee, the differences in the transferred assets should always be taken into account when designing the legal obligations. The transfer of book money in conventional payment transactions is carried out according to different technical procedures than the transfer of crypto assets. In conventional payment transactions, there are already tried and tested technical procedures for forwarding originator and beneficiary data. Here, the German Banking Industry Committee sees no need for an adjustment of the regulations. In Detail: 1. Legal Entity Identifier (LEI), Art. 4 No. 1 lit. d and No. 2 lit. c GTVO-E Article 4 No. 1 lit. d and No. 2 lit. c GTVO-E provide for a new regulation that also affects payment service providers. According to this, the so-called "Legal Entity Identifier" (LEI) of the payer or payee, if available, must also be indicated in the data record. Since in conventional payment transactions there are already proven and sufficient characteristics available for identifying the payer and the payee, an additional indication of the LEI is not necessary. Art. 4 No. 1 lit. d and No. 2 lit. c GTVO-E should therefore be deleted. 2. Definition "account number", Art. 3 No. 18 GTVO-E It is planned to insert a new definition of the term "account number" into the definitions contained in Art. 3 GTVO-E, which is to refer to an "account" that is used to hold crypto assets in custody with a crypto custodian. This definition is misleading from several points of view: On the one hand, there is already a similar definition of the term "payment account" in Art. 3 No. 7 GTVO, which refers to Art. 4 No. 12 PSD2 and refers to a book money account. Usually, the term "account" is closely associated with the understanding that this is a (payment) account managed by a bank. On the other hand, it is planned to insert another similar definition of the term "wallet address" in Art. 3 No. 17 GTVO-E. This is not clearly distinguished from the definition of the term "account number". For this reason, the term "account number" should not be used in connection with crypto assets and should therefore be deleted. For further details, please refer to the attached document.

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Response to Revision of EU rules on Anti-Money Laundering (recast)

18 Nov 2021

Art. 21 still contains no obligation for FIUs to provide specific feedback. However, such feedback is necessary so that obliged entities can improve their suspicious activity reporting practices and thus optimise the prevention of money laundering as a whole. Additional note: The directive – as well as the regulation – does not contain a legal basis for the information exchange and information sharing between banks. The risks of money laundering would be reduced if banks in particular could compare and share information about the same person (know your customer – KYC) and even inform authorities. Alternatively, a cross-border group privilege to share information is necessary. This includes important KYC-data within a group, which would allow a more efficient cooperation between banking groups.For further comments, please refer to the attached document. For further comments, please refer to the attached document.

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Response to Revision of EU rules on Anti-Money Laundering (new instrument)

17 Nov 2021

1. Parts of the previous directive are supposed to be adopted by the regulation, while other aspects of the regulation go beyond the previous directive. However, the regulation often contains referrals to either AMLA or the EU Commission to issue numerous regulatory technical standards (RTS). In order to be able to ensure a practicable implementation and application of the requirements of the Regulation by the obliged entities, the Regulation should already specify the essential obligations.The successive publication of numerous technical standards, on the other hand, considerably jeopardises efficient implementation on the part of the obliged entities. 2. Art. 18 para. 4 requires that an identity document must also be presented to verify the identity of the beneficial owner. Ultimately, this transfers the modalities of identifying the contracting party to the identification of the beneficial owner. Since there is regularly no direct contact with the beneficial owner on the part of the bank, this new orientation hardly seems practicable. 3. Art. 21 contains - also in connection with Art. 17 para. 2 - the obligation of updates at least every five years, combined with the requirement to keep "the relevant documents, data or information of the client up to date". Limiting the frequency of client data updates to a maximum of 5 years is not practicable and ultimately leads to a continuous update loop. 4. Art. 40(2)(b)-(f) considerably restricts the possible scope of outsourcing of internal safeguards in a blanket manner and should be refrained from. The requirements for the prevention of money laundering and terrorist financing through the EU AML legislative package, the respective national law, the future technical standards of AMLA as well as the national supervisory authority are becoming increasingly complex. Therefore, it is of considerable importance, especially for small and medium-sized credit institutions, to be able to outsource the range of tasks of the anti-money laundering officer or individual aspects thereof as comprehensively as possible to highly specialised and reliable service providers. In order to ensure a high quality standard of outsourcing, Art. 40 para. 1 and 3-5 of the draft regulation already contains detailed requirements, which can be supplemented, if necessary, by a duty to notify the competent supervisory authority of the outsourcing as well as by a right of the supervisory authority to audit the insourcer. 5. Art. 42 refers to the threshold value for the clarification of beneficial owners of 25% "on every level of ownership". This would unnecessarily drastically increase the number of beneficial owners - and thus the burden on the obliged entities. Since the controlling beneficial owner is ultimately concerned with finding the natural person who ultimately owns or controls the contracting party, the application of the 25% threshold at every level of ownership is not appropriate. 6. Additional notes Some important aspects, such as the possibility to exchange information between obliged entities and authorities have not been picked up by the regulation. Also, the reuse of CDD-data has not properly been addressed; we would welcome clear confirmation on the possibility to reuse KYC-data, Art. 38. For further comments, please refer to the attached document.

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Response to EU Standard for Green Bond

27 Sept 2021

The German Banking Industry Committee very much welcomes the opportunity to comment on the draft EU Green Bond Standard (EuGBS). Due to the length limitations in the online feedback, we will only highlight some key aspects at this point. Our further comments are outlined in the accompanying document. As a part of the European Green Deal, it is of utmost importance for the EuGBS to be established in a practical manner. Several amendments to the EuGBS are necessary to enable issuers to help stimulate the Green Bond markets and make the European Green Deal a reality. Grandfathering We are concerned about Art. 7(1) subpara. 2 and Art. 7(2) subpara. 3 as they could imply that grandfathering of an EU Green Bond (EuGB) would be eroded indirectly. The requirement to reallocate bond proceeds following new technical screening criteria (TSC) within five years will have a negative impact on issuers, the price of European green bonds, as well as investors. In other words: projects that were suitable for allocation before the amendment would have to be refinanced, the issuer would have to find new ”green” uses of proceeds or, in the worst case, bond proceeds would have to be repaid. This would cause serious difficulties for long-term financing. For example, in terms of covered bonds: due to the long-term nature of mortgage loans that serve as cover assets for covered bonds, rare green mortgage loans cannot be reallocated or replaced easily. In order to provide legal certainty to issuers and investors and prevent any negative impact on the price of EuGBs already issued, it should be made clear that issuers may allocate bond proceeds under the elegated act applicable at the point in time the bond is issued, and they do not need to be replaced until their maturity. Potentially, the complexity described above might cause reluctance to issue EuGBs with a term exceeding five years. As a result, the EuGBs could be perceived as less flexible and less attractive. Use of Proceeds Generally, the requirement to allocate the green bond proceeds in line with Regulation (EU) 2020/852 and the delegated acts (yet to be) adopted thereunder appears useful to ensure consistency with the EU sustainable finance taxonomy. However, it seems questionable whether 100% taxonomy conformity is possible right from the start. We are of the view that a transitional period for the use of proceeds, during which there is no requirement to allocate 100% of proceeds to EU taxonomy-aligned assets, would represent a practical and helpful phase-in for issuers. The resulting flexibility would in particular reduce risks in the context of validating compliance for those assets where experience with minimum safeguards or DNSH criteria is still low at best. A 100% requirement with no transitional period is equivalent to overly careful issuers who will prefer to use other well-known standards when issuing a bond and where the minimum issue size appears more easily achievable. This holds true especially for smaller banks. A threshold of 80% and a five-year transitional period would be reasonable. Costs of the issuance It appears unusual that the costs of the issuance of a green bond cannot be settled out of the proceeds of the issuance. The issuance process always generates costs (such as fees for underwriting, prospectus approval, listing, the external reviewer, legal advisors, auditors, or cost for the printing of a prospectus). These costs are normally allocated to the individual bond issuance. However, the ICMA Green Bond Principles only provide for the use of the “net proceeds” of the issuance (after deduction of costs). Such a prohibition would result in unnecessary complexity as other sources of financing will have to be sought and, hence, reduce the attractiveness of EuGBs. Moreover, it would also have accounting implications and could raise further questions, for example whether such costs are an eligible expense for determining the tax liability of the issuer.

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Response to Revision of Alternative Fuels Infrastructure Directive

9 Sept 2021

The German Banking Industry Committee welcomes the proposal of the Alternative Fuels Infrastructure Regulation. If users are to purchase or to use vehicles powered by alternative fuels, it is essential to recharge the cars without difficulties and to pay without unwelcome surprises. In this regard, uniform payment options and convenient ways to pay are essential. To create high acceptance and fast growth users must be able to use any service station, just as it is for vehicles with combustion engines. Standard deployment of the established card payment systems (debit and credit cards) is the right way forward. The majority of stakeholders responding to the EU’s public consultation in 2020 voted for card payments. This comes as no surprise, since payment via bank cards (debit and credit cards) is the most commonly used payment method in the EU. In total, around 585 million debit cards and 113 million credit cards were in use in the EU in 2020. Card payment is a proven system from the consumer’s point of view, safe and easy to use. Payment amounts can be indicated on terminal displays and payment data are documented on bank statements and in online banking. Contactless payment also allows the use of the latest smartphone-based payment solutions. Payment card terminals are tried and tested in the field. They are utilised in their thousands, at manageable costs, in retail, catering, public transport etc. As a result, they always stand up well in cost terms in comparison with alternative special systems. However, we consider that the distinction between the ad hoc payment options for recharging points of more or less than 50 kW goes against the Regulation’s goal of creating uniformity in payments and providing easy access to all recharging points. Users expect to find reliably the same payment type at every charge point. Internet-based payment methods – via QR Codes, for example – should merely be supplemental to the ability to pay by card. They are neither widespread in Germany and the EU nor the preferred payment solution by a high majority of customers. In order for them to work, the consumer must have a device that is both charged and operational, a network connection, the necessary data volume and an installed solution on its mobile device. Such systems must also be protected against fraud scenarios. In our view, costs for terminals are not a decisive argument. The card terminal market is competitive and offers a diverse array of plug-in solutions in various forms. Some self-service suppliers, such as Sanifair have opted for card terminals for micropayments. Card payment acceptance is already obtainable at prices from €200 per recharging point. Furthermore, from an overall cost perspective, we believe that accepting card payments would actually bring the costs per recharging point and per transaction substantially down, since it leads to a higher usage. Furthermore, it does not make sense that the provisions for recharging points of 50 kW and above will not take effect until 1 January 2027. The course for the deployment of recharging infrastructure is being set now. Any delay arises the risk that recharging points installed before that date will become stranded assets. We therefore suggest that the provisions are brought forward to 1 July 2023, which would also bring them into line with the German regulation. Recharging points that nobody uses benefit neither consumers nor suppliers. If it were found later on that universal debit and credit card acceptance makes sense, the costs of converting the equipment would be up to 10 times higher than the additional costs incurred when a recharging point is first installed.

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Response to European Digital Identity (EUid)

2 Sept 2021

Dear Ladies and Gentlemen, please find attached the German Banking Industry Committee's comments on the EU Digital ID Scheme. The comments are written in German, but a convenience translation into English is included. Kind regards, Tim Kremer (DSGV)

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Response to Consumer Credit Agreement – review of EU rules

2 Sept 2021

The German Banking Industry Committee (GBIC) takes this opportunity to express its opinion on the draft proposal of the Consumer Credit Directive (2021/0171) published on 30 June 2021. GBIC shares the goal of the Draft Directive of offering consumers a high level of consumer protection (recital no. 12). The GBIC also welcomes the European Commission's goal of harmonising consumer protection and digitalisation with respect to consumer credits (recitals no. 4 and no. 6). Nevertheless, consumer protection has to be developed and improved with care and must not result in limiting or restricting the economic freedom of consumers and banks . To that end, the right approaches of the Draft Directive have to be fully and carefully thought through, in order to avoid issuing provisions which hinder or even thwart the set objectives. In addition, when revising the Consumer Credit Directive it should be borne in mind that not the same strict requirements can be applied as for housing loans1 under the principle of proportionality. Particularly the current events (Corona, flood disasters) show that consumers depend on fast and unbureaucratic help. The number of regulations makes it harder in such situations to give consumers the loans they need quickly and unbureaucratically. Being able to grant such short-notice loans means especially retaining the current exceptions from the comprehensive scope of the Directive for overdrafts (see also 2.2). The non-discrimination envisaged in the Draft Directive should not lead to compulsory expansion of the business region or cross-border lending (see also 3.). Concerning general (Art. 9 of the Draft Directive) and pre-contractual information (Art. 10 of the Draft Directive) there is a need to actually reduce the breadth and depth of the given detail. Consumers have to receive the essential information for the credit agreement in one condensed, comprehensible and structured presentation. The proposed period of reflection (sending the information one day before the credit agreement is concluded) is not required to protect the consumer from being bound by the credit agreement, because there is a 14-day right of withdrawal after the conclusion of the agreement (see also 6.). The creditworthiness assessment requirements for general consumer loan agreements have proven themselves in practice and do not need to be changed. Any adaptation to the comprehensive requirements in the Directive on credit agreements for consumers relating to residential immovable property (2014/17/EU) would be disproportionate (see also 9.). The right of withdrawal must have an appropriate time of expiry. Furthermore, consideration should be given to include a standardised template in the Directive, which is to be used as a binding withdrawal information. (see also 13.). Rigid caps for interest rates, effective annual percentage rate of charge and the total cost of the credit uncoupled from market events and beyond the purview of judicial control are not required and hence to be rejected (see also 15.).

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Response to Quick Fix to the UCITS Directive

31 Aug 2021

1. Extension of the fund exemption We welcome the Commission`s decision to propose the extension of the fund exemption. This proposal significantly increases legal certainty for market participants and allows for a longer preparation period. However, the Commission only submitted the amending regulation less than six months before the expiry of the transition period. This is clearly too late, as market participants need at least twelve months to implement new IT-relevant processes. As the delays in the review process have been obvious for long, the extension of the fund exemption at a much earlier stage would have saved market participants considerable additional expense. 2. Provision of information also to professional clients In addition to the extension of the fund exemption, the Commission has proposed to prevent a coexistence of UCITS KID and PRIIPs KID by making the requirement to prepare a UCITs KID dispensable whenever a PRIIPs KID is prepared or provided to the client. This is also positive in principle. In practice, however, this could be understood to mean that distributors would also have to submit a PRIIPs KID for transactions with professional clients. This contradicts the basic decision of the legislator in the PRIIPs Regulation, according to which „Investment funds dedicated to institutional investors are excluded from the scope of this Regulation since they are not for sale to retail investors.“ (see recital 7). The (de facto) extension of the KID obligation to professional clients also runs counter the recently adopted changes to the information requirements concerning professional clients and eligible counterparties in the MiFID quick fix, which are also based on the idea that these clients generally do not require information. In our view, there should be no obligation to provide a professional client with a KID when selling or recommending a fund. 3. Revised RTS pending – transition period must be extended The Commission has not yet submitted a draft for a revised RTS. The market participants (i.e. the manufacturers of funds and derivatives as well as distributors) will only be able to implement the new requirements once they are available. The revised RTS should therefore be published as soon as possible and their date of applicability should be aligned with the end of the period of the fund exemption. According to the explanatory memorandum, “The ESAs reduce the risk of over-optimistic performance scenarios across all PRIIPs types, with a general option for PRIIP manufacturers to use lower percentiles of the estimated distributions of future returns to generate the scenarios, where justified.”. Such a measure would strongly run counter the overall aim of the PRIIPs regulation to create comparability of products. In addition, due to the fact that the Level II requirements are not yet available and market participants are still unable to push ahead with implementation, the fund exemption should be prolongued by twelve months, so that funds will not be covered by the PRIIPs Regulation until January 1, 2023. The six-month extension of the transition period proposed by the Commission is so tightly measured that any further delay in finalizing the RTS would jeopardize timely implementation and require a renewed extension of the fund exemption in a further legislative procedure. 4. Fundamental review of the PRIIPs Regulation required. Finally, it should be noted that the modifications to the RTS proposed by the ESAs will indeed bring about improvements compared to the status quo, but not for all categories of investments. Additionally, they will not eliminate all shortcomings of the PRIIPs KIDs. The latter will require a thorough review of the PRIIPs Regulation, covering the requirements on Level I and II. In this respect, we welcome the Commission's announcement that a comprehensive review of the PRIIPs Regulation is to take place as part of the Retail Investment Strategy.

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Response to Quick fix to the PRIIPs Regulation

31 Aug 2021

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Response to Designation of a statutory replacement rate for EONIA (Benchmark)

30 Aug 2021

The German Banking Industry Committee is the joint committee operated by the central associations of the German banking industry. These associations are the Bundesverband der Deutschen Volksbanken und Raiffeisenbanken (BVR), for the cooperative banks, the Bundesverband deutscher Banken (BdB), for the private commercial banks, the Bundesverband Öffentlicher Banken Deutschlands (VÖB), for the public-sector banks, the Deutscher Sparkassen- und Giroverband (DSGV), for the savings banks finance group, and the Verband deutscher Pfandbriefbanken (vdp), for the Pfandbrief banks. Collectively, they represent more than 1,700 banks. I. General Remarks on the proposed Implementing Act We welcome the EU Commission's move to adopt an Implementing Act to replace EONIA by statutory means. Institutions have been replacing EONIA references and introducing fallback provisions in numerous contracts and instruments and continue to do so. However, due to the large market distribution and the fact that such replacements and fallback provisions cannot be introduced unilaterally, it will not be possible to convert EONIA references in all contractual relationships and instruments by the deadline. The Implementing Act will provide a transparent and balanced solution for those cases. It will ensure the necessary legal certainty and also prevent market distortions. The proposed replacement of the EONIA by the €STR plus the spread adjustment of 8.5 basis points in all relevant contracts is a clear, consistent and transparent solution, in particular, as this effectively only perpetuates the results of the application of the calculation method used for EONIA since 2 October 2019 by the ECB. II. Suggested adjustments and clarifications Having said this, we believe that minor adjustments and further clarifications should be considered to improve the effectiveness of the statutory replacement tool in this case and in order to prevent uncertainties and misunderstandings: For one, we believe that the date of application of the EONIA replacement should be moved forward to 1 January 2022 (as in the case of the parallel CHF LIBOR replacement) to eliminate any time gap between the date of the statutory replacement becoming applicable and the formal ending of the deadline for the use of EONIA (31 December 2021) in accordance with Art. 51 para. 4b of the Amending Regulation (EU) 2019/2089. Any time gap between the two dates could cause confusion and uncertainties over the implications. In addition, we suggest to expressly confirm that the statutory replacement does not prevail over or set aside any replacements or suitable fallback provisions agreed by the parties. This already follows from Art. 23b para. 3 of the Amending Regulation ((EU) 2021/168). A corresponding legal clarification would prevent any uncertainty or misconception in the markets and would also serve as a further encouragement to market participants to implement necessary replacements and fallback provisions, including for other IBOR rates, bilaterally or by way of protocols. Although our members will continue to work intensively on reducing the number of EONIA-related contracts and instruments, the Implementing Act will nevertheless play an essential role for those instruments and contractual relationships that could not be converted in time. A timely finalisation of the Implementing Act would therefore be very welcome. Similar challanges may exist in other IBORs. In these cases, more differentiated approaches may be required.

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Response to Requirements for Artificial Intelligence

6 Aug 2021

Dear Sir or Madam, Please find enclosed the statement of the German Banking Industry Committee on the European Commission's proposed regulation on the regulation of artificial intelligence (AI act). Sincerely, Dr. Wiebke Lüke

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Response to Revision of Non-Financial Reporting Directive

22 Jun 2021

The German Banking Industry Committee supports the planned transformation to a sustainable economy in Europe. The submitted legislative proposal for a “Corporate Sustainability Reporting Directive” is an important step towards harmonised sustainability reporting throughout Europe. Nevertheless, the implementation of the new reporting requirements seems to be rather ambitious, both in terms of content and time. This applies especially to those banks and savings banks that are reporting for the first time. They will face very high challenges. For those institutions that already issue a sustainability report, this move will also lead to a considerable amount of additional work. In addition to expanding the scope of application and the contents of reporting, the challenges are particularly due to the digital disclosure format and the very tight deadlines for implementation. We have set out the details in our attached statement. We kindly ask you to consider our comments. This feedback was given on behalf of: Die Deutsche Kreditwirtschaft

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Response to Commission Delegated Regulation on taxonomy-alignment of undertakings reporting non-financial information

2 Jun 2021

The German Banking Industry Committee (GBIC) welcomes the opportunity provided by the European Commission to comment on the draft Delegated Act (DA) published on 7 May 2021 specifying the requirements of Article 8 of the Taxonomy Regulation (Regulation (EU) 2020/852). The requirements of the Delegated Act are very extensive and appear to be too complex and impracticable, including in light of the level of detail. We welcome the transitional periods provided for by the European Commission, but see further scope for supporting the efficient implementation of the Taxonomy Regulation (see our positions below on the timing of application). The European Commission announced the green asset ratio (GAR) as a simple KPI for ESG in 2019. In its current version, however, the level of detail of the information required is very high, to the extent that we can no longer talk of a simple KPI. The level of detail of the information requested is not appropriate and presents all institutions, especially those institutions that will newly fall within the scope of the reporting obligations under the CSRD, with major challenges in terms of personnel, methodologies and data technology. In addition, the GAR has hardly been publicly discussed so far. There has not been an opportunity to review the GAR in terms of its intended application and design until the present publication of the Delegated Act on Article 8 of the Taxonomy Regulation and the consultation paper on disclosing ESG risks published by the European Banking Authority (EBA) on 1 March 2021. The technical criteria and thresholds for environmental objectives 1–2 of the taxonomy on which the GAR is based only recently become available for the first time in the shape of the Delegated Act published by the European Commission on 21 April 2021. Accordingly, the remarks in our comments are extensive (see Annex). GBIC considers the following points to be essential: • Harmonisation with other legislative proposals: GBIC is voting to report the GAR exclusively under the DA and to delete the corresponding, almost identical templates for Pillar 3 disclosures under the CRR. In addition, it is necessary to harmonise the Delegated Act with the (new) CSRD in terms of the challenges relating to timing and reporting. • Existing business/new business: The existing business entered into at least until December 31, 2021 should not have to be included in the calculation of the KPIs on a permanent basis, but only the future new business thereafter. An optional discretion should be granted for this. • Thresholds for taxonomy checks: GBIC supports optional thresholds for taxonomy checks for individual transactions as well as for portfolios. • Comparability: It should be clarified to what extent and for how long industry-specific estimates and the use of proxies are possible. We also advocate splitting the GAR into two KPIs to ensure comparability: a GAR 1 (full taxonomy compliance/alignment) and a GAR 2 (substantial contribution only). • Suggestions for reducing the complexity of disclosure templates: The level of detail of the information requested from the credit institutions does not appear to be appropriate. • Timing of application/transitional periods: GBIC is in favour of harmonising the timing of Article 11(3) with the initial application of the CSRD, i.e. for the 2023 reporting period. • Undertakings not subject to an obligation to publish non-financial information pursuant to Article 19a or 29a of Directive 2013/34/EU: GBIC is in favour of allowing optional inclusion (“voluntary may”) in the numerator starting in the first KPI reporting period. • Retail exposures related to immovable property for stock: GBIC is in favour of allowing optional inclusion starting in the first KPI reporting period and wish to request an optional threshold for the DNSH test for retail exposures beyond the transitional period (2024).

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Response to Retail Investment Strategy

12 May 2021

GBIC welcomes the opportunity to comment on the Commission’s roadmap: 1. Inducements A potential ban on inducements would run counter the roadmap’s explicit aim to raise the level of participation by retail investors in financial markets. GBIC does not share the Commission’s view that “due to payments of inducements, advice provided by intermediaries may sometimes be biased towards products with higher rewards for intermediaries”. The idea that commission-based advice per se encourages conflicts of interest is unfounded. Fee-based advice is by no means exempt from conflicts of interest and is certainly susceptible to problematic incentives. More importantly, commission-based advice has a very strong social component. The over-whelming majority of investors simply cannot afford fee-based advice with hourly rates ranging from 100 to 400 EUR. Surveys on the German market show that 85% of the population consider a separate fee for advice socially unjust. A ban on inducements would lead to a situation where the majority of investors can no longer afford any investment advice. The consequences of such an advice gap would be disastrous which is illustrated by figures from the UK market: Studies show that 69% of investment advisors in the UK indicated that they have refused clients in the past; the most important reason (43%) for this situation is that advisory services do “not pay” for these clients (cf. HM Treasury, FCA, London: Financial Advice Market Review. Final Report, March 2016, p.6). GBIC therefore strongly argues that the inducement-based model be maintained. 2. Qualification of advisors GBIC believes that a general certification obligation as well as a pan-European quality label would be disproportionate. To what extent qualification or further training is necessary, has to be verified on a case-by-case basis, depending especially on the pre-qualification of each employee. Additionally, in Germany, there is no problem with verifying the necessary knowledge and competence, in particular due to the globally recognised dual education system. 3. Harmonization of MiFID and other EU requirements GBIC shares the Commission’s view that different rules and disclosures from one instrument to another – and even diverging information for the same instrument – make it difficult for consumers to make investment decisions that correspond to their needs. The different requirements under MiFID and PRIIPs mean that investors receive contradicting information in the respective documents: In the KID, product costs are shown including inducements and in the ex ante without inducements. Moreover, PRIIPs should be adapted to the new requirement in Art. 24(5a) MiFID II so that the KID is also required to be provided in electronic format (except where the client has requested receiving the information on paper). Further harmonization is needed with a view to the conditions under which the KID may be provided after the conclusion of the transaction (by adjusting Art. 13(3) PRIIP to the new Art. 24(4) MiFID II). Recently, the Commission has published a legislative proposal to introduce sustainability considerations under MiFID II. In its proposal, the Commission has introduced a definition of sustainability that is different to the current definition under the SFDR. E.g. based on the different definitions a fund could be declared as “sustainable” under the SFDR but not under MiFID (or vice versa). The different outcomes can be misleading for investors and undermine their trust in the information provided by distributors of financial services. To avoid this, the requirements need to be harmonised. 4. Effectiveness of suitability assessments The regulatory requirements for the conduct of the suitability assessment will be further updated in the upcoming months when advisors need to explore the sustainability preferences of their clients. One has to be aware of these modifications when exploring the effectiveness of the current practice.

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Response to Instant Payments

7 Apr 2021

We would like to express our concern that the first part of the consultation on Instant Payments (targeted consultation) was published before the end of the deadline for feedback on the Impact Assessment. The SEPA Instant credit transfer ("Instant Payments/ SCT Inst") is an important enrichment of the payments service offering in SEPA, which is well accepted by customers from an actual demand. In addition, SCT Inst creates the basis for new pan-European payment solutions and further offers. This is characterised by supplementary feature and rules that may go beyond the SCT Inst rulebook. The German Banking Industry Committee (GBIC) welcomes the political efforts to support these trends and developments in a market driven way. The prolongation of the exemption period in Article 4 para. 4 of the SEPA-Regulation for two more years would further support the positive development of adherence to SCT Inst. Based on this, the necessity of mandatory participation could be examined. In this context, mandatory participation by PSPs that do not offer payment accounts for customers, especially smaller or specialised institutions, continues to be inappropriate. At the same time, a clear distinction should be made between the customer demand and new solutions, which are enabled by SCT Inst. This is necessary as both the respective market needs and the applicable legal conditions could be assessed differently (e.g. regarding the topics of fraud prevention, sanction screening, etc.). From a market perspective, instant payments address a specific demand and is a payment instrument in its own right. Given market demand, technological and legal conditions, instant payments may not fully replace conventional credit transfers with its different characteristics. Successful and sustainable innovations require business cases for investments. PSPs need to be able to refinance their considerable investments in the necessary infrastructure as well as higher operating and risk related costs. The introduction of limitations to prices for instant payments impede market innovation and could result in higher account management fees depriving the customer of the possibility to choose between different payment instruments based on their individual needs. The consultation should also include questions aimed at corporates, SME and public institutions. For example, it could be clarified whether, beyond the partial need for digital payment solutions at the POI, there is the need to process transfers in real time and to complete the underlying business immediately. This implies that internal processes have to be modified so that the funds are immediate available. Otherwise, an expectation could be created among consumers that companies or public institutions are not able to fulfil due to a lack of internal processes. Regarding consumer protection it should be considered that the finality of credit transfers constitutes a defining feature of instant payments. It provides legal certainty for both sides. For the payer to finalize the payment and for the payee when providing services or shipping products. It is therefore an important factor in the competitiveness of instant payments and credit transfers. It should be open to the market participants to define additional product features in the different payment solutions.

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Response to Central securities depositories – review of EU rules

1 Apr 2021

1. Scope of regulation – buy-in procedure requires trading participants/partners in particular? Commission delegated regulation (EU) 2018/1229 explicitly obliges trading participants (Art. 29) or trading partners (Art. 31) to initiate a buy-in. This statement, however, has arisen from statements made by a national supervisory authority, according to which CSDR only obliges parties involved in securities settlement, i.e. CSDs and their CSD participants and their clients, but not trading participants. Although the trading participants may be those who are responsible for the contract-side performance disruption due to late instructions, they were only liable on the basis of possible contractual agreements. On the other hand, the CSDR only had effects at settlement level and therefore only committed participants in securities settlement. Whether and to what extent a buy-in is caried out is based solely on whether the formal requirements for a settlement fail are met. These statements have caused great uncertainty not only with regard to the obligations of the buy-in and the implementation of the requirements, but also how to deal with penalties and compensation payments and who in this context should be regarded as ultimately obligated “trading participant” or “trading partner”. We therefore consider it necessary to clarify in the context of the CSDR review that the trade level is also obligated by the CSDR requirements. 2. Possibility of mutual “cancellation” Insofar as trading parties have made contractual arrangements as to how to proceed in the event of a late or non-delivery, they may also instruct their Custodians to cancel the original Settlement Instructions, cf. Art. 7(3) CSDR. Cancellation is also possible, for example, in case of incorrect instructions. However, there is considerable uncertainty from a national supervisory authority that a mandatory buy-in can be avoided by simply canceling the settlement instructions. In the event of cancellation, the obligation to perform would be eliminated and there could not be a loss of performance. The CSDR does not want to make a right a duty to that extent. This seems to us to be questionable both against the background of the CSDR’s regulatory concerns – namely to improve the settlement discipline – and from the point of view of contract law. In addition, it is very difficult to implement a cancellation in the mass business. These two aspects would mean additional significant changes with regard to the scope of obligations “in the chain”. In this respect, without prejudice to our comments from our opinion on the CSDR review of 03.02.2021, we would like to clarify this. We must point out the urgency of clarifying all these issues in the light of the fact that system programming must be carried out in good time in order to be able to comply with the prudential requirements by 1 February 2022. Besides that, we would like to draw you attention to our position paper (enclosed), in which we have raised other urgent topics.

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Response to Directive/regulation establishing a European framework for markets in crypto assets

6 Jan 2021

Our comments in detail on the “Proposal for a Regulation on Markets in Crypto-assets” as part of the European commission’s Digital Finance Package are enclosed by the attached document. Furthermore, we will submit still an additional commentary.

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Response to Climate change mitigation and adaptation taxonomy

17 Dec 2020

The German Banking Industry Committee believes that, for the definition of the taxonomy, it is important to provide more precision by using clear, streamlined, and easy-to-use technical screening criteria. The current draft of the delegated act (including its annexes) is difficult to understand and, in particular, difficult to put into practice due to its significant length, its complexity, and the numerous cross-references. Most companies will only be able to implement the current version of the delegated act with a great deal of effort and will need to engage a sustainability consultant. We therefore propose that the European Commission provides greater clarity and support on using the taxonomy, e.g. by setting out the expectations for due diligence in respect of DNSH criteria and social minimum safeguards more explicitly and by providing specific information on how the principle of proportionality is to be applied. To make it easier to use the taxonomy, we suggest that a method be developed for companies not subject to the NFRD under which institutions would be able to use sector-specific estimates or proxy values, for example, in order to eliminate gaps in the data for the companies that do not provide this data. We propose revising the NACE code classification so that it is easier to categorize economic activities. Giving the option to choose a CO2 accounting method (ISO vs. GHG Protocol, etc.) in the context of an economic activity may significantly reduce comparability for investors and make the due diligence process more complex. The taxonomy should aim to standardize the methods for individual economic activities and thereby ensure that comparisons can be made. Given the short implementation period, the scope of the delegated act should be restricted to new business from Jan 1, 2022. Business that is in force on that date and extensions should be excluded from the scope. The envisaged application date of Jan 1, 2022 is problematic in our view, including with regard to transparency in non-financial statements pursuant to art. 8 of the Taxonomy Regulation. An act providing more specific information is not expected to be available until June 1, 2021. Legal clarification is needed, stating that the disclosure obligation only comes into force for financial years beginning on or after Jan 1, 2022. We believe that a threshold of, for example, €10 million for taxonomy audits of individual transactions is urgently needed with regard to the granularity of banks’ retail business. For an applicable taxonomy in the building sector, a harmonised European and national framework would be required first including comparable NZEB standards, standardised EPCs and, based on these, uniformly derived C02 threshold values as well as EU-wide or national publicly accessible registers in which the necessary data are collected and can be accessed. In the transition towards the above described status a clear commitment to best national practice is necessary. Not in all countries energy performance certificates (EPC) for buildings indicate energy efficiency classes. Therefore, to require for the acquisition and ownership of existing bulidings an EPC label “A” is not feasible. We advocate, at least on a transitional basis, to follow the TEG’s proposal that buildings belong to the TOP 15% of the national building stock in terms of primary energy demand. In the long term, an orientation towards absolute thresholds for energy and carbon emissions would be preferable. Some of the do no significant harm requirements and the evidence required in this context cannot be met by the financing institutions or at reasonable cost, e.g. due to a lack of national regulations/laws and the resulting lack of data collection by the owners/builders, the required proof of water consumption cannot be provided. Legal requirements need to be addressed to manufacturers/retailers. A corresponding requirement could then be legally standardised as a construction standard.

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Response to Digital Operational Resilience of Financial Services (DORFS) Act

15 Dec 2020

DORA is a step towards harmonisation, which the industry sorely needs. The implementation of EU-wide security standards and harmonised tests and uniform reporting structures is crucial if we are to deepen harmonisation of the single European digital market. Removing national inconsistencies in implementing security standards and in supervisory practices will be key to fostering EU-wide innovation. However, the current legislative proposal goes far beyond the harmonisation approach initially planned by the European Commission. Additional detailed requirements lead to additional costs without actually improving cyber-resilience: The current regulatory standards of the EBA follow a proportionality approach, particularly with regard to the risk and complexity of institutions. The principle-based requirements of these guidelines currently leave scope of action with regards to their implementation. However, the additional detailed requirements in the legislative proposal lead to (bureaucratic) increasing efforts and additional costs. The foreseen Regulatory Technical Standards (RTS) of the are expected to result in an even greater density and depth of regulation. There should be no legal definition of methods via RTS, as short-term adaptability of methods and practices is required. Exceptions for "microenterprises" does not include banks, due to the low balance sheet total limit and/or the usual size of the workforce. Thus, the proportionality principle is not sufficiently applied. Existing requirements of the NIS- and PSD2 Directives would overlap with the requirements presented in the current proposal, so that an adaptation of these Directives would also be necessary if points were to be incorporated in a new Regulation in their present form. On the other hand, the planned harmonisation of the reporting system for security incidents should be emphasized positively. Of course, major incident reporting must be combined in a single procedure that includes PSD2- and NIS incident reporting. The requirements for the management of ICT Third Party Risk should distinguish whether or not the ICT supports critical / essential functions. The provisions on termination of the contract appear to be absolute and go beyond the requirements of the currently implemented EBA guidelines. In particular, the requirements for financial institutions to terminate contractual relationships in case of breaches of contractual agreements - without any materiality limit - appears to be a disproportionate interference with contractual freedom. In addition, a multi-vendor approach is neither necessary nor purposeful to address concentration or lock-in risks. Depending on its design, a mandatory multi-vendor strategy bears the risk that in particular small companies may not be able to use ICT service providers. As a general rule, the facilitation of outsourcing by groups and institutions which are members of an institutional protection scheme, as provided for in the EBA guidelines on outsourcing arrangements, should also be applied to the management of ICT services provided by third parties. We also welcome in principle the idea of a new supervisory framework for critical ICT service providers operating across Europe. However, this should be combined with easier monitoring by financial institutions and the use of these service providers should not be made more difficult by restrictive requirements. The focus should be particularly on those international ICT service providers for which the enforceability of audits at the level of the individual financial institution cannot be sufficiently guaranteed. In supervising critical TPPs, national legal frameworks and established national structures must be taken into account. As a general rule, the Regulation should have a sufficient transposition period of 36 months after entry into force (see Article 56, which, with two exceptions, only refers to a period of 12 months after entry into force).

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Response to Banking Union: Review of the bank crisis management and deposit insurance framework (SRMR review)

8 Dec 2020

Dear Sir or Madam, Please find attached the opinion of the German Banking Industry Committee on the Commission’s combined evaluation roadmap/Inception Impact Assessment “Review of the bank crisis management and deposit insurance framework (BRRD/SRMR/DGSD review)”. Yours sincerely, on behalf of the German Banking Industry Committee National Association of German Cooperative Banks Dr. Olaf Achtelik Dr. Jan T. Böttcher

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Response to Commission Delegated Regulation on taxonomy-alignment of undertakings reporting non-financial information

4 Sept 2020

The German Banking Industry Committee is grateful for the opportunity to comment. Given their differences in terms of business activities and financial reporting, we believe that the European Commission has taken the right approach by distinguishing between non-financial companies and financial companies – and taking account of their distinctive features – for the purposes of the planned disclosure obligations regarding non-financial information in the non-financial statements of the aforementioned large companies (more than 500 employees) under the Taxonomy Regulation (art. 8). In our view, the requirements regarding the disclosure of taxonomy-compliant revenue, capital expenditure, and operating expenses that apply to non-financial companies (art. 8(2) Taxonomy Regulation) need to be defined more specifically for financial companies. The development of new indicators may be a suitable option. Moreover, the total capital expenditure and spending indicators are defined relatively broadly and do not adequately reflect transitional and enabling activities, which means that more detailed information on both aspects is required. Because institutions’ changeover costs are expected to be high, we ask that the financial sector to be involved in specific concept development processes from an early stage. We wish to point out that the suitability of more specific definitions for financial companies also depends on the nature of the taxonomy-compliant business activities. For example, the outcomes of the securities business differ from those of the lending business. The taxonomy reporting requirements should take account of the high transaction costs for the banking industry that would arise from checking compliance with the criteria, particularly in small-scale, high-volume retail business and especially in the case of do no significant harm criteria and minimum safeguard criteria, which are difficult to check. A possible practical option would to be to establish thresholds (in millions of euros) for individual transactions. We do not believe that defining further indicators in the NFRD or in a delegated act is the right approach because they generally do not apply to every company. A standardized, binding set of rules would be preferable to a wide variety of defined indicators. When developing EU-wide harmonized indicators, the way they interact with and impact on European rules on financial reporting and bank-specific accounting needs to be taken sufficiently into consideration. It is also important that the deliberations on disclosing taxonomy-compliant outcomes look at the aspect of proportionality. The imposition of requirements on banks to collect taxonomy-compliant data in the lending business would fundamentally have a direct impact on all borrowers in the real economy and thus on SMEs. It is therefore necessary to ensure an appropriate cost-benefit ratio and not to impose excessive bureaucracy costs on SMEs as a result of additional reporting obligations. To reduce the costs for the entire economy, important information that is needed in order to fulfill the reporting obligations in article 8 of the Taxonomy Regulation should be collected and made available centrally (e.g. centralized data register). As financial companies cannot evaluate their portfolios without sufficient and valid data from the real economy, they should only be under such a reporting obligation if the real economy provides the necessary information. Given the complexity of the evaluation process, sufficiently generous implementation periods should be granted. It would also be a good idea to limit the reporting to new business. Given the close relationship between the transparency obligations in the Taxonomy Regulation and those in the announced update of the NFRD, we ask that there is consistency with other disclosure requirements (NFRD, Disclosure Reg., Pillar III disclosure) and that duplication of rules in the Taxonomy Regulation and the NFRD is avoided.

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Response to Consumer Credit Agreement – review of EU rules

13 Aug 2020

Zusammenfassung Inadequate scope: Bei Darlehensverträgen über an sich geringe Summen oberhalb von 200 EUR ist grundsätzlich ein extrem hoher Bearbeitungsaufwand zu konstatieren, der in keinem guten Verhältnis zum Ertrag steht – und das bei insgesamt überschaubaren Risiken. Deshalb sollte bei der Novelle der Richtlinie geprüft werden, ob die Untergrenze nicht bedeutsam angehoben werden kann. Verbraucherdarlehen mit niedrigen Kreditbeträgen bis zum Beispiel 10.000 EUR sollten dann Erleichterungen dahingehend erfahren, dass Informationspflichten auf ein den Darlehensbetrag berücksichtigendes Maß begrenzt werden. Content and disclosure of information: Die Informationen in den Standard European Consumer Credit Information (SECCI) müssen rationalisiert und an die digitale Kommunikation angepasst werden. In der vorvertraglichen Information als Phase der Vertragsanbahnung sollte der Verbraucher – ähnlich wie im Wertpapierbereich - nur die für ihn wirklich relevanten Informationen erhalten. Die für den Verbraucher relevanten Inhalte sind der Sollzins, der effektive Jahreszins, die Vertragslaufzeit, die Höhe der monatlichen Rate und das Recht auf Widerruf. Insufficient safeguards to ensure responsible lending/borrowing: Die Kreditvergabepraxis zeigt, dass weitergehende Vorgaben zur Kreditwürdigkeitsprüfung nicht erforderlich sind. Der Kreditgeber ist bereits jetzt verpflichtet, alles zu tun, um die negativen Sanktionen einer unsachgemäßen Bonitätsprüfung nicht nur aus aufsichtsrechtlichen, sondern auch aus zivilrechtlichen Gründen zu vermeiden. Die strengeren Anforderungen an Immobiliar-Verbraucherdarlehen werden der unterschiedlichen wirtschaftlichen Bedeutung von Verbraucherkrediten einerseits und Wohnimmobiliarkrediten andererseits gerecht. An dieser Unterscheidung sollte weiterhin festgehalten werden. Eine weitergehende Standardisierung der Bewertung von Risikoprofilen würde den Markt blockieren, ohne die Besonderheiten der einzelnen Mitgliedstaaten und die der einzelnen Marktteilnehmer zu berücksichtigen. Darüber hinaus würden gemeinsame Normen für die Bonitätsbewertung einen Durchschnitt festlegen, der Personengruppen vom Zugang zu Krediten ausschließen würde. Vor dem Hintergrund dieser Überlegungen würden weitere Vorgaben bei der Kreditwürdigkeitsprüfung im Ergebnis zu Lasten des Verbrauchers führen und die Kreditvergabemöglichkeiten unangemessen einschränken. Exceptional situations: Es erscheint sehr ehrgeizig, rechtliche Regeln für Ausnahmesituationen, wie beispielweise die Corona-Krise, vorwegzunehmen. Vorzugwürdig ist, in derartigen Krisen eine sachgerechte Einzelfallregelung zu finden.

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Response to Strengthening the consideration of sustainability risks and factors for financial products (Directive (EU) 2017/593)

6 Jul 2020

1. The definitions of sustainability preferences in MiFID II Delegated Regulation (DelReg) and MiFID II Delegated Directive (DelDir) are not entirely identical. In the DelDir, the sustainability products are set out in bullet points, in the DelReg with (a) and (b). The version in the DelReg is preferable, as the products can be better designated (product according to Art. 2 (7) a)). 2. The proposed widening of the new definition of sustainability preferences in Art. 1 (5) no. 5 draft DelDir with further criteria over and above Art. 8 SFDR would mean the introduction of a new product category ("Art. 8 plus products"), which would create not only additional complexity, but also devalue the category of Art. 8 products which has just been introduced. The inclusion of requirements over and above the provisions of the SFDR would lead to considerable contradictions between the DelDir and the SFDR, which must be avoided at all costs. It is imperative that the requirements for sustainability products in MiFID II and the SFDR must be harmonised, which also means that the requirements for determining target markets pursuant to MiFID II may in no way exceed the existing provisions of the SFDR. We therefore urgently call for the removal of (i) and (ii) from Art. 1 (5) no. 5 draft DelDir. (i) should be removed as in derogation from Level 1 SFDR it brings in elements of the impact products (Art. 9 SFDR) into Art. 8 products. While the current Level 2 drafts for the SFDR even require a warning message (“no sustainable investment objective”) respectively merely showing “sustainable investments” in an Art. 8 product, which can also be zero, the draft under consideration here evidently extends this to an obligation. The inclusion of (i) would mean that the defining boundaries between Art. 8 and Art. 9 products would become blurred. In the inclusion of additional requirements beyond the SFDR and particularly based on the widened regulations for Art. 8 products we see the risk that a strategy product will under certain circumstances be seen as sustainable within the meaning of the Disclosure Regulation (because the product meets the requirements of Art. 8), but in the target market pursuant to MiFID II has to be declared as non-sustainable (because e.g., the manufacturer decides not to report on the adverse impacts on sustainability). For investors, it will not be understandable that a product is described as sustainable in several client information documents pursuant to the provisions of the SFDR but treated as non-sustainable in the course of investment advice. 3. We would be grateful for an explicit clarification that the comparison of the sustainability criterium in the target market assessment is required only in advice situations and not for advise-free or execution-only orders (in this way an alignment of the suitability and appropriateness tests would be achieved. In addition, we propose clarity that sustainability is not subject to deviation reporting and thus in the event of deviations from the target market no information has to be provided to the manufacturer. The draft under discussion makes no mention of these two aspects. 4. The DelDir has to be transposed into national law by the Member States. Then, the institutions have to apply the requirements. For this they should have twelve months’ time after publication in the EU Official Journal (Art. 2 (1) subpara. 2). At the same time, the national transposition should occur no later than 364 days after publication in the EU Official Journal (Art. 2 (1) subpara. 1). This would mean that in an extreme case the institutions would know the national regulation only one day before having to apply them. This would be simply impossible. The national transposition should be completed no later than six months prior to the application deadline. We call for the inclusion of an appropriate provision in the DelDir.

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Response to Strengthening the consideration of sustainability risks and factors for financial products (Regulation (EU) 2017/565)

6 Jul 2020

1. Derivatives should be excluded from the scope of application. These products often serve to hedge business risks where sustainability considerations play no role. 2. The proposed widening of the new definition of sustainability preferences in Art. 2 (7) (b) MiFID II draft Delegated Regulation (DelReg) with further criteria over and above Art. 8 SFDR would mean the introduction of a new product category ("Art. 8 plus products"), which would create not only additional complexity, but also negate the category of Art. 8 products which has just been introduced. The inclusion of requirements over and above the provisions of the SFDR would lead to considerable contradictions between DelReg and SFDR, which must be avoided at all costs. We therefore urgently call for the removal of (i) and (ii) from Art. 2 (7) (b) draft DelReg. (i) should be removed as in derogation from the Level 1 SFDR it brings in elements of the impact products (Art. 9 SFDR) into Art. 8 products. While the current Level 2 drafts for the SFDR even require a warning message (“no sustainable investment objective”) and/or merely showing “sustainable investments” in an Art. 8 product, which can also be zero, the draft DelReg evidently extends this to an obligation. The inclusion of (i) would mean that the defining boundaries between Art. 8 and Art. 9 products would become blurred. If Art. 2 (7) (b) (i) and (ii) draft DelReg is deleted, recital 6 should also be amended accord-ingly. In this case, we suggest to delete from "Whilst financial products that pursue..." until the end of the recital. This ensures that recitals and articles of the draft DelReg run in parallel. So long as Art. 2 (7) (b) (i) and (ii) draft DelReg are not deleted, the complexity of the DelReg will be increased in excess of the provisions of the SFDR. The resulting risk that in-vestors will not understand the regulations on the concept of sustainability preferences in this granularity and hence reject it in turn jeopardises the lawmaker’s actual goal: to attract more investment in sustainable investments in line with the SFDR. 3. A new recital should clarify that ESG-compliant products could be recommended to investors without sustainability preferences. It should also be clarified that in certain situa-tions non-ESG-compliant products can be recommended to investors with ESG preferences, if appropriately justified, e.g. in a portfolio context. 4. We ask that the planned addition of a separate reference in Art. 23 (1) draft DelReg to sustainability risks be abandoned. A comprehensive legal requirement in this respect is not to be found in the CRR. According to Art. 449a CRR II, large institutions that have issued securities that are admitted to trading on a regulated market are in future obliged to disclose information on ESG risks, This requirement will apply effective 28 June 2022 and on the basis of an EBA report yet to be prepared. The EBA has furthermore in the fifth Capital Requirements Directive been given an audit/inspection mandate for the integration of sustainability risks in the supervisory review process (SREP) and the internal risk management of the institutions (Art. 98 (8) CRD V). It has announced the release of a first discussion paper on this issue for summer 2020. Additions to the SREP guidelines in this regard will still be the subject of consultation. This should not be pre-empted. In banking supervisory law, sustainability risks are generally regarded as drivers of known types of risks. In this regard, there does not need to be any treatment as a separate type of risk and only the consideration as a risk driver makes economic/business sense. For these reasons, a separate quantification and the setting of a tolerated risk level exclude themselves. Generally, a quantification based on the current data situation and lacking instruments is for most banks not possible. We support an alignment of the regulatory requirements in banking and securities supervisory law.

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Response to Key elements of the methodology reflecting environmental, social or governance (‘ESG’) factors

6 May 2020

The comments are attached as a separate document.

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Response to Minimum standards for benchmarks labelled as EU Climate Transition and EU Paris-aligned Benchmarks

6 May 2020

We appreciate the opportunity given to comment on the SUSTAINABLE FINANCE – MINIMUM STANDARDS FOR CLIMATE BENCHMARKS. The comments are attached as a separate document.

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Response to Climate change mitigation and adaptation taxonomy

21 Apr 2020

The German Banking Industry Committee appreciates the possibility to provide feedback regarding the inception impact assessment on the development of technical screening criteria for activities contributing to climate change mitigation and climate change adaption in order to specify the Taxonomy Regulation. We would be very pleased to provide our knowledge and expertise in the new Platform on Sustainable Finance, which shall advise the European Commission on the technical screening criteria and analyse the impact of technical screening criteria in potential of potential costs and benefits for a given activity. The length of the technical annex to the TEG final report on the EU taxonomy published in March 2020 makes the complexity of the taxonomy clear. Such a complex level of detail will likely delay implementation of the taxonomy and also render it difficult to keep pace with technological progress in the area of sustainable economic activities, making a great deal of adjustment necessary. It has also an impact on outstanding financial products that has to be taken into account. Its use will thus be unreasonably difficult for SMEs in particular. It should also be noted that there may well be conflicting objectives between the various aspects of sustainability. For example, environmental protection concerns often have to be balanced against social objectives (prosperity and employment). A taxonomy and its delegated regulation on Level 2 should provide guidance on dealing with such conflicting objectives. What is needed is a good balance between ecology, economy and social responsibility. Otherwise, the steering effect towards sustainable development is likely to be lost. We also call on the Commission to provide public data sources alongside with the Level 2 requirements in order to be able to efficiently and uniformly comply with the Regulation.

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Response to Revision of Non-Financial Reporting Directive

24 Feb 2020

Dear Sirs/Mesdames, We are taking this opportunity to share with you our considerations on the review of Directive 2014/95/EU. Furthermore, we are very interested in the evolution of non-financial reporting. We believe that the provision of high-quality sustainability information is an important issue. In the light of interconnected markets and the goal of a European Capital Markets Union we support a European initiative that aims to improve current non-financial reporting in order to be more productive and viable than action being taken in the individual Member States,. For a successful and accepted future regulation we consider it paramount that an appropriate balance be ensured between the desired transparency and regulatory costs for the undertakings concerned. Additional reporting requirements can be justified where the usefulness of the information reported is clear. Bureaucratic burdens with no clearly identifiable added value result in undesirable impacts and be counterproductive (cf. section C, “Preliminary assessment of expected impacts: likely economic impacts”). Therefore a review of the NFRD should not only focus on an expansion of reporting requirements, but also on possible simplifications and facilitations of the requirements already in force. With regard to an appropriate and balanced cost-benefit equation, the current standards and possible gaps should be considered more carefully (cf. option 2) before expanding and intensifying the NFRD. We believe that there is not enough evidence yet to support the problems identified (cf. section A, Problems the initiative aims to tackle). Results of the studies listed in section D should be awaited here, so that they can be taken into account when reviewing the NFRD. The vast majority of our member institutions and their investors have positive experiences with non-financial reporting as per the CSR Directive and the corresponding non-binding guidelines. This approach (option 1) creates a relatively high degree of flexibility, which allows to focus on truly relevant and material issues in non-financial reporting. Further to this, it facilitates different requirements of financial undertakings and non-financial undertakings to be taken into account, as laid out in the Taxonomy Regulation (Article 4d). A certain degree of voluntariness ensures that undertakings are not forced to report on issues that are irrelevant to them. Just as with financial reporting, non-financial reporting should follow the management approach and therefore be guided in principle by risk management – not vice versa. This is the only way to establish a focus on material reporting details and avoid a schematic expansion of disclosure of non-financial aspects. As regards option 3, we see a danger of agreeing on the "lowest common denominator" and therefore requirements that are too rigid, which would tend to obstruct reporting on the undertaking-specific relevant facts. Non-financial information often means qualitative statements with an individual character, depending on business models and risk profiles. In our opinion, the usefulness of information for making decisions does not rely on a perceived comparability. Concerning fixed rules on where and how to report, the potential added value and the resulting burdens on the undertakings subject to a reporting requirement should be considered. On a general note, we believe that it is necessary to keep the principle of proportionality in mind. Mid-sized and regionally-focused financial undertakings in particular make a significant contribution to sustainable economic activity, whereby the regional economy is financed and its transformation supported. However, they can only provide their financial services on a permanent basis if they are not overwhelmed by administrative requirements. We remain at your disposal to discuss these matters further. Yours sincerely, German Banking Industry Committee

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Response to A simplified prospectus for companies and investors in Europe

21 Dec 2018

The German Banking Industry Committee welcomes the Delegated Regulation (DR) proposed by the Commission. The draft includes many of the points proposed in ESMA’s Final Report. At the same time, the discretionary scope for the parties subject to the requirements set out in the Prospectus Regulation ((EU) 2017/1129, PR) is left untouched. This balanced approach creates a solid basis that must and will prove itself until the next evaluation in 2022. Notwithstanding the above, we would like to draw attention to a few points that, in our view, require readjustment. Please find our detailed remarks in the attached file.

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Response to Sovereign bond-back securities product regulation

24 Aug 2018

Making the European Economic and Monetary Union (EMU) more stable and crisis-proof is one of Europe’s priority policy objectives. The further integration and diversification of the European financial sector is a significant aspect of this. That is because better risk diversification and cushioning by the capital markets could make the EMU overall more resilient. The completion of the Banking Union and the Capital Markets Union are therefore key components for achieving this goal. However, these two measures will only live up to expectations if the European Monetary Union can, at the same time, be stabilised through reforms. The two-way dependence between governments and banks has proven to be a threat to stability in the past. This “bank-sovereign nexus” is particularly risky in a monetary union because none of the member states can borrow in its own national currency. Additionally, a two-way dependence arises because banks also invest predominantly in their own government's securities (“home bias”). In addition to the strong home bias of the banks in investing in sovereign bonds, the European Commission additionally refers to an insufficient supply of “safe assets” to justify the proposal. With its proposal to introduce sovereign bond-backed securities (SBBSs), the European Commission hopes to offer an opportunity for weakening the bank-sovereign nexus. However, SBBSs are not the only proposal for solving this problem, although other proposals such as capital requirements for sovereign bonds are highly controversial, so a further proposal appears to make sense here. The German Banking Industry Committee (GBIC) therefore notes with interest the European Commission’s proposal. However, there are numerous elements in the proposal that call its practicability into question. The bank-sovereign nexus became a problem in the Monetary Union in particular because the financial markets started having doubts about the sustainability of certain Member States’ debt levels. SBBSs could probably better distribute these risks, for example through a more diversified sovereign bond portfolio at commercial banks, thereby reducing the home bias in particular. Apart from this, however, it should be a priority task of economic policy to reduce the bank sovereign nexus also through a solid financial policy in all euro states. Despite the goal for Member States not to be jointly liable for SBBSs, it should be considered that the securitisation construction could come under political pressure if losses occur, which could encourage the communitisation of European government debt. Please find attached more detailed comments.

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Response to Institutional investors' and asset managers' duties regarding sustainability

23 Aug 2018

The German Banking Industry Committee (GBIC) would like to give feedback on the proposal for a regulation on the establishment of a framework to facilitate sustainable investment. Please see the PDF attached.

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Response to Institutional investors' and asset managers' duties regarding sustainability

22 Aug 2018

The GBIC welcomes the opportunity to comment on the European Commission's legislative proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending Regulation (EU) 2016/1011 on low carbon benchmarks and positive carbon impact benchmarks as regards organisational requirements and operating conditions for investment firms and defined terms for the purposes of that Regulation. We support the European Commission’s intention, as part of the Action Plan on Financing Sustainable Growth, to mobilise more financial resources for a sustainable economy and to promote financial market stability.

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Response to Evaluation of the Consumer Credit Directive

27 Jul 2018

The European Commission intends to evaluate the Consumer Credit Directive (2008/48/EC) by way of a public consultation at the end of 2018. The German Banking Industry Committee welcomes this opportunity to present its views in the context of the “Have Your Say” survey and would like to submit the following points for consideration. Overall, it is important that equitable regulations should be adopted which take account of both consumer protection and the interests of the banking industry and do not result in disproportionate burdens. Where new obligations are being considered, the cost-benefit ratio should be taken into account. It is also vital that the regulations continue to reflect the different significance non-mortgage consumer credit and mortgage consumer credit have for consumers. Thus, existing differences in regard of the scope and requirements between the Mortgage Credit Directive and the Consumer Credit Directive should be retained. Please find attached the more detailed position of the German Banking Industry Committee.

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Response to EU small listed companies Act

13 Jul 2018

The German Banking Industry Committee (GBIC) warmly welcomes the EU Commission’s intention to address regulatory shortcomings stemming from the Market Abuse Regulation or Prospectus Regulation whilst preserving the highest standards of investor protection and market integrity. The existing market abuse, transparency and disclosure rules can be burdensome and difficult to interpret for all groups of issuers. Reducing of administrative burden can help to support the promotion of small and medium-sized enterprises (SMEs). However, we believe that the proposed adjustments to Regulation (EU) No 596/2014 (Market Abuse Regulation, MAR) must not undermine investor protection and market integrity (see our comments on Article 18 MAR). In some cases, the proposed changes point to some shortcomings in the current MAR regime, resulting in high compliance costs and complexity for all issuers concerned. We therefore propose to consider including the proposed amendments in the general provisions of the MAR applicable to all groups of issuers (see our comments on Article 19 MAR).

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Response to Institutional investors' and asset managers' duties regarding sustainability

21 Jun 2018

The German Banking Industry Committee (GBIC) welcomes the opportunity to comment on the European Commission's legislative proposal for amending Regulation (EU) 2017/565 supplementing Directive 2014/65/EU of the European Parliament and of the Council as regards organisational requirements and operating conditions for investment firms and defined terms for the purposes of that Directive.

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Response to Review of Regulation on cross-border payments

12 Jun 2018

We would like to present the German Banking Industry Committee’s position regarding the Proposal for an Amendment of the Cross-Border Payments Regulation (EC) No. 924/2009 (hereinafter referred to as ‘Commission proposal’) from 28 March 2018. In principle, the German Banking Industry Committee welcomes the objective to strengthen the euro as a single currency and also shares the opinion that transparency may be a decisive parameter in a functioning market. However, we would like to raise objections to the European Commission’s choice of the regulatory instruments which it deems suitable to achieve this aim. The German Banking Industry Committee oposes any regulatory intervention in market price mechanisms as contained in Art. 3 (‘uniform prices for cross-border euro payments and domestic payments in the local currency’) and in Art. 3a para. 2 sub-para. 2 (‘capping of fees charged for currency conversion services’) of the European Commission proposal. It feels imperative to us to choose less onerous measures of similar suitability to maintain the principle of proportionality and adequately account for the concerns of the market players. The European Commission’s proposed regulation in the field of dynamic currency conversion services in Art. 3a of the Commission proposal feels unreasonable and is also unnecessary in its presented form. Thus, Art. 3a (and consequently Art. 3b as well) should be deleted without substitution. This evaluation is based on the following aspects: • The proposal appears to be impracticable. It takes no account of the banking processes and practices associated with the currency conversion services required for transactions at ATMs and points of sale in stationary merchant stores, either in technological terms or with a view to the actual processes concomitant with the underlying currency transactions and regulations under Payment Services Directive 2 (‘PSD 2’). • The proposal causes excessive infrastructural costs whereas additional benefits to the consumer appear rather limited. This lack of practicability could only be remedied via comprehensive expansion of the technical infrastructure or the introduction of a complete separate process. The associated cost (expenditure) is disproportionate to the assumed enhancement of the protection level / increase in the number of the respective consumers’ recorded transactions. • The proposal is unnecessary. It ignores the fact that the Payment Services Directive 2 has installed comprehensive obligations to provide information whenever currency conversions are involved (e.g. Artt. 45 para. 1; 48; 52 no. 3; 57 para. 1; 59 PSD 2). This regulation ensures sufficient transparency for consumers and at the same time acknowledges the impracticability mentioned above. The PSD 2 thus reflects a well-balanced split of obligation to inform between payment service providers of the payer and alternative providers of currency conversion services. In case the Commission’s commitment to provisions regarding dynamic currency conversion remains untethered, we would like to call upon it to include at least the following amendments: (1) The scope of application of Art. 3a of the Commission proposal urgently requires further clarification (e.g. no extension to online payments). (2) Card-issuing institutes, functioning as payment service provider of the payer, should be excluded from the scope of Art. 3a. If the Commission identifies the need for more transparency, the solution has to be found within the scope of Art. 59 PSD 2. (3) Art. 3a para. 2 sub-para. 2 of the Commission proposal, which provides for an EBA mandate to set a maximum fee for currency conversion services during the transition phase until Article 3a enters into force should be deleted without substitution. Consequently, we also recommend a deletion of Art. 3b without substitution. Please find attached the more detailed position of the German Banking Industry Committee.

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Response to Development of secondary markets for non-performing loans

6 Jun 2018

Dear Sir or Madam, please find attached the comments of the German Banking Industry Committee (GBIC).

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Response to Statutory prudential backstops addressing insufficient provisioning for newly originated loans that turn non-performing

25 May 2018

Please see attached file.

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Response to Initiative on an integrated covered bond framework

15 May 2018

Please see attached file.

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Response to Public consultation on minimum requirements in the transmission of information for the exercise of shareholders rights

9 May 2018

The German Banking Industry Committee (GBIC) welcomes the opportunity to comment on the Draft Commission Implementing Regulation laying down minimum requirements implementing the provisions of Directive 2007/36/EC of the European Parliament and the Council as regards shareholders identification, the transmission of information and facilitation of exercise of shareholders rights.

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Response to Directive on cross-border distribution of investment funds

9 May 2018

Dear Sir or Madam, Please find attched the comments of the German Banking Industry Committee. Yours sincerely, Birgit Seydel

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Response to Draft Delegated Act amending the Commission Delegated Regulation on the Liquidity Coverage Ratio ('LCR')

21 Feb 2018

The German Banking Industry Committee (GBIC/DK) is pleased to participate in the Commission’s initiative to amend the Delegated Regulation (EU) 2015/61 on the Liquidity Coverage Ratio. We welcome the implemented clarifications e.g. regarding the symmetric treatment of the same transactions in inflows and outflows (e.g., repo and reverse repo transactions as well as derivatives) or that the LCR shall be fulfilled for all transactions irrespective of their currency denomination and not in each significant currency. Nevertheless, there is concern in terms of further adjustments drafted. Please find attached the corresponding DK Comment.

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Response to Review of the European Supervisory Authorities

20 Dec 2017

The German Banking Industry Committee takes note of the review and reform of the European supervisory system comprising EBA, ESMA and EIOPA. A competitive financial market is of elementary importance for the EU. The review of how efficiently the European supervisory authorities function plays a crucial role in this. Against this background, in our opinion, the EU Commission’s proposal contains appropriate additions to the ESAs’ competencies insofar as pan-European issues are concerned, such as the direct supervision of the administrators of critical benchmarks by ESMA. Nevertheless, we consider that the legal basis invoked by the EU Commission from Art. 114 of the Treaty on the Functioning of the European Union (TFEU) for the proposals are not sufficient in all points, particularly with regard to the additional competencies and the planned restructuring of the funding of the ESAs. • The proposals to supplement additional competencies of the ESAs with regards to a “supervisory handbook” and a “strategic supervisory plan” should be rejected, as they would mean a de facto first step towards a direct supervision by the ESAs of the national supervisory authorities and thus also an indirect supervision of market participants. • Additional competencies for ESMA only in moderation: in particular, no powers for ESMA for funds supervision and prospectus scrutiny. • The proposed additions/amendments of the process to issue Level 3 measures are not sufficient to curb the ESAs self-mandating. Precisely because of the strongly heterogenous composition of the SGs, the proposed two-thirds majority constitutes a too high threshold that in practice would make using the mechanism considerably more difficult. In this regard, a simple majority should suffice. On grounds of transparency, the Commission should furthermore be obliged to justify its decision and to disclose this likewise. • The ESAs are authorities backed by the supervisory authorities of the Member States. Against this background, the proposal to set up an Executive Board independent of the representatives of the national authorities is to be viewed critically. • We advocate keeping the existing simple and clear funding model (60% national supervisory authorities, 40% EU budget) and are against fee-financing. Only in this way can we avoid massive budget expansions of the ESAs that would be expected with funding through the institutions. Funding the supervisory authorities with a fixed portion of the EU budget ensures budget control and prevents uncontrolled spending. • Direct requests for information by the ESAs are to be rejected. The penalisation by itself for careless infringements against such requests is not only disproportionate, but there is the latent risk that what are actually subsidiary direct requirements for information will in practice burgeon into a control system and in this respect dilute the proven competencies of the national supervisors. • The consistent application of supervisory law among the Member States must be ensured. • In enforcing convergence, the European leitmotiv of subsidiarity must be taken into account too.

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Meeting with Olivier Guersent (Director-General Financial Stability, Financial Services and Capital Markets Union)

10 May 2017 · Banking Package/Risk Reduction Package

Meeting with Jonathan Faull (Director-General Financial Stability, Financial Services and Capital Markets Union) and Gesamtverband der Deutschen Versicherungswirtschaft e.V.

24 Apr 2015 · Austrian Hypo Alpe Adria Special Act