Kreditwesengesetz

The German Banking Act Kreditwesengesetz, literally meaning law of the banking system, is the primary legally implementation of the Basel Accords. It is binding for banks and other institutes providing financial services in Germany and effective since January 1935, but updated in 1962.

Purpose

The main goals of the KWG are:

To guarantee and safeguard the functionality of banks
To safeguard the creditors from losing their invested capital, i.e. any kind of share

The Kreditwesengesetz imposes restriction on risk-related business activities and extends the duty of disclosure. It ensures competences of regulators and is the legal justification of the German Solvability Directive and MaRisk, the corresponding regulation with more detailed definitions and requirements.

External resources

Category:1935 in law
Category:European Union corporate law
Category:German business laws