Approval of financial holding companies and mixed financial holding companies; power to issue a statutory instrument

(1) Parent financial holding companies and mixed parent financial holding companies, and EU parent financial holding companies and mixed EU parent financial holding companies, that stand at the head of a group supervised by the supervisory authority on a consolidated basis, require written approval from the supervisory authority. The approval requirement also applies to other financial holding companies and mixed financial holding companies that 1. are to be designated as superordinate undertakings within the meaning of subsection (4), first sentence, point 3, or 2. are obliged, on a sub-consolidated basis, to comply with the requirements of this Act or of Regulation (EU) No 575/2013, as amended on 17 June 2025, provided the supervisory authority is responsible for supervising the relevant subgroup on a consolidated basis.
(1a) The supervisory authority regularly reviews, in any case at least once a year, whether a CRR credit institution, an undertaking that has applied for a licence under section 32(1), first sentence, that would be a CRR credit institution once the licence is granted, or a superordinate undertaking, has properly identified every parent undertaking of the CRR credit institution or of the undertaking applying for a licence under section 32(1), first sentence, that meets the criteria for classification as a parent financial holding company, mixed parent financial holding company, EU parent financial holding company, or mixed EU parent financial holding company. Where a parent undertaking has its registered office in another Member State, the supervisory authority cooperates closely with the competent authorities there in the review under the first sentence.
(2) The applicant must accompany its application for approval with the following: 1. a complete description of the organisational structure of the group, clearly identifying all parent and subsidiary undertakings, together with information on the registered office and the type of activity of each undertaking of the group; 2. the particulars necessary to assess the reliability and professional qualifications of the persons named in section 2d(1); 2a. the particulars necessary to assess whether the persons named in section 2d(1) have sufficient time available; 3. where a CRR credit institution is part of the group, the particulars under section 32(1), fifth sentence, point 6 or point 6a; 4. a complete description of the internal organisation and the allocation of tasks within the group; 5. all other particulars necessary to carry out the assessment under subsections (3) and (4). The supervisory authority may request further information necessary to assess the application. Where the applicant has its registered office in another state of the European Economic Area, it also submits the documents under the first sentence to the competent authority of that state. Where the applicant has its registered office in Germany and the authority responsible for supervision on a consolidated basis is the European Central Bank, the documents under the first sentence are also to be submitted to the Federal Institute.
(3) The supervisory authority grants the approval under subsection (1) where 1. the internal arrangements and the allocation of tasks within the group are appropriate for compliance with the requirements of this Act and of Regulation (EU) No 575/2013 on a consolidated or sub-consolidated basis, and are in particular suitable to a) coordinate all of the applicant's subsidiary undertakings, where necessary also through an appropriate allocation of tasks between the subsidiary institutions, b) prevent, mitigate, or resolve conflicts within the group, and c) enforce, throughout the group, the strategies set by the applicant for the group as a whole; 2. the organisational structure of the group does not impair effective supervision of the institutions belonging to the group on an individual, consolidated, or sub-consolidated basis; 3. the applicant's business is conducted by at least two persons within the meaning of section 2d(1), these persons are reliable and possess the professional qualifications necessary to conduct the applicant's business; and 4. the holders of a significant holding in a CRR credit institution of the group, or, where no significant holding in that CRR credit institution is held, the 20 largest shareholders at most in that CRR credit institution, are reliable and otherwise meet the standards required in the interest of the sound and prudent management of the CRR credit institution. In assessing the organisational structure under the first sentence, point 2, the supervisory authority has particular regard to the applicant's position within a group extending over several tiers, the shareholding structure, and the applicant's role within the group.
(4) On the application of the financial holding company or mixed financial holding company subject to the approval requirement under subsection (1), first sentence, or subsection (1), second sentence, point 2, the supervisory authority grants an exemption from the approval requirement where 1. the applicant's principal activity, with regard to institutions and financial institutions, consists in acquiring and holding participations in subsidiary undertakings, 2. the applicant is not a resolution entity within the meaning of Article 2(1), point 83a(a), of Directive 2014/59/EU, as amended on 11 April 2024, 3. a subsidiary CRR credit institution, or a subsidiary financial holding company or mixed subsidiary financial holding company approved under subsection (3), has been designated as the superordinate undertaking and is responsible for compliance with the requirements of this Act and of Regulation (EU) No 575/2013, as amended on 17 June 2025, on a consolidated basis, and has all the necessary resources and legal powers for this, 4. the applicant does not participate in the conduct of business at group level, and 5. there is otherwise no obstacle to effective supervision of the group on a consolidated basis. The applicant must accompany its application for exemption from the approval requirement with the information necessary to assess whether the conditions of the first sentence are met. The supervisory authority may request further information necessary to assess the application. Applicants exempted from the approval requirement under subsection (1) pursuant to this subsection are, subject to section 10a(3), nevertheless still to be included in the scope of consolidation under this Act and under Regulation (EU) No 575/2013.
(5) The supervisory authority continuously monitors whether the applicant meets the conditions of subsection (3) or (4). The applicant transmits to the supervisory authority without delay all information necessary for this continuous monitoring. Where the applicant has its registered office in another state of the European Economic Area, the supervisory authority also transmits the information to the competent supervisory authority of the state in which the applicant has its registered office.
(6) Where the conditions under which the supervisory authority granted the approval under subsection (3) are not, or are no longer, met, the supervisory authority may, in particular to ensure or restore the continuity and integrity of supervision on a consolidated basis and compliance with the requirements of this Act and the statutory instruments issued under it, and of Regulation (EU) No 575/2013, on a consolidated basis, 1. prohibit the applicant, or the company approved under subsection (1), from exercising the voting rights in CRR credit institutions of the group, 2. order the applicant, or the company approved under subsection (1), to transfer its respective holdings in the CRR credit institutions of the group to its holders, 3. temporarily designate a CRR credit institution, or another financial holding company or mixed financial holding company of the group, as the group's superordinate undertaking, 4. restrict or prohibit distributions or interest payments to shareholders, 5. order the applicant, or the company approved under subsection (1), to reduce or dispose of its respective holdings in institutions or other undertakings of the financial sector, 6. order the applicant to submit without delay a plan for restoring the conditions that led to the grant of approval under subsection (3). The supervisory authority may in addition take interim measures against the holders and managers of the applicant, or of the company approved under subsection (1), to avert dangers to compliance with the supervisory requirements to which the group is subject on a consolidated basis. In the case of a mixed financial holding company, particular regard must be had to the effects of the measures under the first and second sentences on the financial conglomerate.
(7) Where the conditions under subsection (4), first sentence, are no longer met, an exemption from the approval requirement that has been granted must be revoked by the supervisory authority. An application for approval under subsection (2) must be submitted without delay.
(8) In the cases under subsection (2), third and fourth sentences, the supervisory authority, in decisions under subsections (3) to (7) and in the decision under section 10a(3), cooperates in full coordination with the competent authority of the state of the European Economic Area in which the financial holding company or mixed financial holding company under subsection (1) has its registered office. For this purpose, the supervisory authority transmits to the competent authority of that state an assessment of the matter, together with a proposed decision in that regard. Both authorities take a joint decision within a period of two months after the transmission, which the supervisory authority communicates to the financial holding company or mixed financial holding company under subsection (1); the decision must also be implemented by the Federal Institute where the financial holding company or the mixed financial holding company is established domestically but supervision on a consolidated basis is exercised by the competent authority of another state of the European Economic Area. Where the two authorities are unable to reach a joint decision within the period under the third sentence, they refer the matter, before the period expires, to the European Banking Authority under Article 19 of Regulation (EU) No 1093/2010 of the European Parliament and of the Council of 24 November 2010 establishing a European Supervisory Authority (European Banking Authority), amending Decision No 716/2009/EC and repealing Commission Decision 2009/78/EC (OJ L 331, 15.12.2010, p. 12; L 101, 18.4.2015, p. 62), as last amended by Regulation (EU) 2019/2175 (OJ L 334, 27.12.2019, p. 1), and take their joint decision in accordance with the decision of the European Banking Authority. Where the company under subsection (1) is a mixed financial holding company, a decision under subsections (3) to (7) requires the consent of the financial conglomerate's coordinator competent under Article 10 of Directive 2002/87/EC. Where that coordinator does not give consent, the supervisory authority refers the matter to the competent European supervisory authority, namely the European Banking Authority or the European Insurance and Occupational Pensions Authority.
(9) The supervisory authority must inform the applicant, within four months of receipt of the complete documents, but no later than within six months of receipt of the application for approval or the application for exemption from the approval requirement, whether the approval or the exemption from the approval requirement is granted or refused.
(10) The supervisory authority must maintain a register on its website, in which it enters, once a year, all financial holding companies and mixed financial holding companies approved domestically, or exempted from the approval requirement under subsection (4), first sentence. For a financial holding company or mixed financial holding company exempted from the approval requirement under subsection (4), first sentence, the superordinate undertaking within the meaning of subsection (4), first sentence, point 3, is additionally to be entered. The Federal Ministry of Finance may, by statutory instrument not requiring the consent of the Bundesrat, make further provisions on the content of the register and on the duties of the financial holding companies and mixed financial holding companies to cooperate in maintaining the register.