Trustee and deputies

(1) A trustee, and at least one deputy, must be appointed for every Pfandbrief bank.
(2) The trustee and deputies must possess the knowledge and experience necessary to perform their tasks. Qualification as a statutory auditor or sworn accountant is presumed to indicate the necessary knowledge. Appointment as trustee or deputy is excluded where grounds exist giving rise to concern of bias. This is in particular the case where the person is, or has been within the preceding three years, in an employment or mandate relationship with the Pfandbrief bank.
(3) The appointment is made by BaFin after hearing the Pfandbrief bank; before the first issuance of Pfandbriefe, an appointment is made only on the application of the Pfandbrief bank. The appointment may be time-limited and may be revoked by BaFin at any time for good cause. The appointment ends at the latest at the end of the month in which the 75th year of age is completed. On the appointment of an administrator under section 2(5), first or second sentence, section 30(2) or (5), section 36a(1), first sentence, or that administrator's provisional appointment under section 36a(1), fifth sentence or (2), the office of trustee is suspended until the administrator's office ends. The trustee remains obliged to communicate to the administrator all information that may be relevant to the administration of the cover assets.
(4) The trustee must communicate to BaFin the material findings and observations made in the course of the trustee's activity, and must provide BaFin with information on request. The trustee is not bound by instructions of BaFin.
(5) The trustee and deputies are liable to the Pfandbrief bank and to the Pfandbrief creditors and the creditors of claims from derivative transactions under section 4(3), for their activity, only in the case of intent and gross negligence. The trustee's or deputy's liability to pay damages is, in the case of grossly negligent conduct, limited to EUR 1 million. It may not be excluded or limited by contract. Where the liability of the trustee or deputy is covered by insurance, a deductible of one and a half times the annual remuneration fixed under section 11(1) must be provided for. The Pfandbrief bank may conclude the insurance contract for the benefit of the trustee and deputy and pay the premiums.