Measures in Special Cases and Application for Insolvency

(1) Where an institution's own funds do not meet the requirements of this Act, BaFin may 1. prohibit or restrict withdrawals by the owners or shareholders, and the distribution of profits, or 2. order the institution to take measures to reduce risks, insofar as those risks arise from particular types of business and products, in particular from the granting of credit, or from the use of particular payment systems.
(2) Where an institution's ability to meet its obligations to its creditors is at risk, in particular the safety of the assets entrusted to it, or the conditions for revoking the licence or registration are met, or there is reasonable suspicion that effective supervision of the institution is not possible, BaFin may take interim measures to avert these dangers. It may in particular 1. issue instructions for the management of the institution's business, and 2. prohibit or restrict owners and managers from exercising their activity.
(3) Under the conditions of subsection (2), first sentence, BaFin may, to avoid insolvency proceedings or to avoid revocation of the licence, temporarily 1. prohibit the acceptance of funds and the granting of loans, 2. issue a prohibition on disposal of and payment by the institution, 3. order the closure of the institution to dealings with customers, and 4. prohibit the acceptance of payments not intended for the discharge of liabilities to the institution. Section 46(1), third to sixth sentences, and section 46c of the Banking Act apply correspondingly.
(4) Where an institution becomes unable to pay its debts or becomes over-indebted, its managers must notify BaFin of this without delay, enclosing informative documents; the managers must also give such notification, enclosing corresponding documents, where the institution is likely to be unable to meet its existing payment obligations at the time they fall due (impending inability to pay). Insofar as these persons are obliged under other legal provisions to apply for the opening of insolvency proceedings in the event of inability to pay or over-indebtedness, the notification obligation under the first sentence takes the place of the obligation to apply. Insolvency proceedings over the assets of an institution take place in the event of inability to pay, over-indebtedness or, under the conditions of the fifth sentence, also in the event of impending inability to pay. Only BaFin may apply for the opening of insolvency proceedings over the assets of an institution holding a licence under section 10(1) or section 11(1). In the event of impending inability to pay, however, BaFin may apply only with the institution's consent, and only where measures under subsection (3) do not appear to hold out prospects of success. Before appointing the insolvency administrator, the insolvency court must hear BaFin. The order opening the proceedings must be served on BaFin separately.
(5) The rights to apply under section 3a(1), section 3d(2) and section 269d(2) of the Insolvency Code lie, in the case of institutions, exclusively with BaFin. The initiation of coordination proceedings under sections 269d to 269i of the Insolvency Code takes effect for the group-affiliated institutions only where BaFin has applied for it or consented to it.