Licence

(1) A credit institution with its seat within the territorial scope of this Act that wishes to carry on the Pfandbrief business requires the written licence of the Federal Financial Supervisory Authority (BaFin) under section 32 of the Banking Act. In addition, the credit institution must satisfy the following conditions for a licence to carry on the Pfandbrief business: 1. the credit institution must have core capital of at least EUR 25 million, 2. the credit institution must be authorised as a CRR credit institution within the meaning of Article 4(1)(1)(a) of Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No 648/2012 (OJ L 176, 27.6.2013, p. 1; L 208, 2.8.2013, p. 68; L 321, 30.11.2013, p. 6; L 193, 21.7.2015, p. 166; L 20, 25.1.2017, p. 3), as last amended by Regulation (EU) 2021/558 (OJ L 116, 6.4.2021, p. 25), 3. the credit institution must have suitable rules and instruments within the meaning of section 27 for steering, monitoring and controlling the risks to the cover pools and the issuance business based on them, 4. it must appear from the credit institution's business plan submitted to BaFin that the credit institution will carry on the Pfandbrief business regularly and sustainably, and that the organisational structure necessary for this is in place, 5. the organisational structure and resources of the credit institution must, depending on the scope of the licence, appropriately reflect future Pfandbrief issuance and the real estate financing, sovereign financing, ship financing or aircraft financing business. By way of derogation from section 33(3) of the Banking Act, the licence required under the first sentence must also be refused where the conditions of the second sentence, nos. 1 to 5 are not satisfied. Section 32(2), second sentence of the Banking Act applies with the proviso that the licence for the Pfandbrief business may also be limited to individual activities named in section 1(1), second sentence, nos. 1 to 4. The theoretical and practical knowledge required under section 25c(1), second sentence of the Banking Act is, in the Pfandbrief business, depending on the scope of the licence, regularly presumed to exist where the managers have corresponding knowledge in the field of mortgage lending, municipal lending, ship lending or aircraft financing and its refinancing.
(2) BaFin may also revoke the licence to carry on the Pfandbrief business, in addition to the cases under section 35(2) of the Banking Act, where 1. the conditions of subsection (1), second sentence, nos. 1 to 3 and 5 are no longer satisfied, 2. the Pfandbrief bank has not issued any Pfandbriefe for more than two years and it is not expected that the Pfandbrief business will be resumed as a regularly and sustainably conducted banking business within the next six months, or 3. the Pfandbrief bank has persistently infringed provisions of this Act or the ordinances or orders issued to implement it. Subsection (1), fourth sentence applies accordingly.
(3) Where BaFin revokes the licence for the Pfandbrief business, or it lapses, the cover pools must be wound up.
(4) Where BaFin fully revokes the licence under section 32 of the Banking Act to conduct banking business and provide financial services, or it lapses in full, the Pfandbrief bank's previous licence continues to exist, as regards the cover pools and the liabilities secured by them, until the complete and timely satisfaction of the Pfandbrief liabilities, unless BaFin expressly orders that the revocation of the licence extends to them.
(5) In the cases of subsections (3) and (4), an administrator must be appointed where this is necessary for the complete and timely satisfaction of the Pfandbrief liabilities and an administrator has not already been appointed under section 30(2) or (5). The appointment may also be made on the application of BaFin, with the consent of the managers of the Pfandbrief bank, where the appointment of an administrator appears expedient. The provisions of sections 30 to 36, with the exception of section 30(2), sixth sentence in conjunction with section 30(2a), apply accordingly to the procedure for appointment and the legal position of that administrator.
(6) BaFin publishes on its website a list of the institutions that hold a licence to carry on the Pfandbrief business under section 1(1), second sentence. This list must also include particulars of the scope of the licence, the date the licence was granted, and, for which of the Pfandbrief bank's outstanding Pfandbrief classes which of the designations named in section 41a may be used. In cases where the conditions of section 42(1) are satisfied, 19 July 2005 must be stated as the date the licence was granted. BaFin must update this list at least once every quarter.