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Regulations relating to the Pfandbrief Act

Net Present Value Regulation

§ 4 Pfandbrief Act provides that the total amount of the Pfandbriefe outstanding must at all times be covered at their nominal value by assets of at least the same amount. In addition, it stipulates that the cover must be ensured at all times according to the net present value including statutory overcollateralization of at least 2%. This net present value cover must withstand certain interest rate and exchange rate changes. The Pfandbrief Net Present Value Regulation stipulates the extent of such interest rate and exchange rate changes as well as details on the method for calculating the net present value.

Net Present Value Regulation »
Cover Register Statutory Order

Pfandbrief banks record in a cover register all assets serving as cover for Pfandbriefe. A separate register is maintained for each Pfandbrief type (Mortgage Pfandbriefe, Public Pfandbriefe, Ship Pfandbriefe) (§ 5 par.1 Pfandbrief Act).

Details concerning the form and the requisite contents of the cover register and of the entries are set forth in the Regulation on the Form and Content of the Cover Registers pursuant to the Pfandbrief Act and on the Recording of Entries (Cover Register Statutory Order (DeckRegV) (§ 5 par. 3 Pfandbrief Act).

The Federal Ministry of Finance authorized the Federal Financial Supervisory Authority (BaFin) to issue this Statutory Order (Federal Law Gazette 2005 I p 3187 of November 25, 2005). BaFin issued the Statutory Order on August 25, 2006. On August 31, 2006, the Statutory Order was published in the Federal Law Gazette (Federal Law Gazette I no. 41 p 2074 ff of August 25, 2006). It entered into force on September 1, 2006, and with the Law on the Onward Development of Pfandbrief Legislation of March 20, 2009 (Federal Law Gazette I, p 607, 621 of March 25, 2009) was adapted to reflect the amendments to the Pfandbrief Act.

Cover Register Statutory Order (DeckRegV) » Forms »
Regulation on the Determination of the Mortgage Lending Value

A mortgage lending value must be determined in accordance with § 14 Pfandbrief Act for properties and for rights in respect of properties and comparable rights serving as cover for Mortgage Pfandbriefe.

The determination of the mortgage lending value is regulated by § 16 Pfandbrief Act. Pursuant to § 16 par. 4  Pfandbrief Act, a Regulation which the Federal Ministry of Finance has authorized the Federal Financial Supervisory Authority (BaFin) to issue shall set forth details on the methodology and form of the determination of the mortgage lending value as well as minimum requirements with regard to the valuer’s qualifications.

On August 8, 2005, BaFin presented a draft of the Regulation on the Determination of the Mortgage Lending Value (BelWertV), on which the Central Credit Committee of the Leading Associations of the German Credit Industry (ZKA) commented on November 10, 2005.

This Regulation was published on May 22, 2006 (Federal Law Gazette I no. 24) and entered into force on August 1, 2006.

Regulation on the Determination of the Mortgage Lending Value of May 12, 2006 (in its current version)» ZKA‘s Comments of November 10, 2005 on the draft » Letter of the Federal Financial Supervisory Authority (BaFin) to the ZKA of August 5, 2005 » Regulation on the Determination of the Mortgage Lending Value - draft (as at July 11, 2005) » Annexes 1 - 4 to the draft »
Regulation on the Determination of the Mortgage Lending Value of Ships

Under § 22 par. 2 Pfandbrief Act, a ship mortgage lending value must be determined for ships and ships under construction serving as cover for Ship Pfandbriefe. Rules governing the determination of the ship mortgage lending value are set forth in § 24 Pfandbrief Act.

§ 24 par. 5 Pfandbrief Act states that a Regulation must specify details of the methodology for determining the mortgage lending value and the form it is to take as well as the minimum qualifications the valuer is required to have.

The Regulation was published in the Federal Law Gazette I no. 19 p 851 ff of May 6, 2008), and entered into force on July 1, 2008.

Regulation on the Determination of the Mortgage Lending Value of Ships »
Regulation on the Determination of the Mortgage Lending Value of Aircraft

Under § 26b par. 2 Pfandbrief Act, an aircraft mortgage lending value must be determined for aircraft within the meaning of § 1 par. 2, sent. 1 no. 1 Law on Rights in Aircraft (LuftFzRG), which are entered in a pubic register and are to serve as cover for Aircraft Pfandbriefe.

Rules governing the determination of the aircraft mortgage lending value are set forth in § 26d par. 1 and 2 Pfandbrief Act. According to § 26d par. 3 Pfandbrief Act, a Regulation is to specify details of the methodology for determining the mortgage lending value and the form it is to take as well as the minimum requirements qualifications the valuer is required to have.

The Regulation on the Determination of the Mortgage Lending Value of Aircraft (FlugBelWertV) was published in the Federal Law Gazette I no. 25 p 1036 ff of April 20th, 2009) and entered into force on May 15th, 2009.

Regulation on the Determination of the Mortgage Lending Value of Aircraft »
Funding Register Statutory Order

Details on how a funding register is to be maintained in accordance with §§ 22a - o are set forth in the Funding Register Statutory Order.

It was published on December 22, 2006, in the Federal Law Gazette (Federal Law Gazette I no. 63 p 3241 ff of December 18, 2006), and entered into force on December 23, 2006.

Regulations according to § 1 Abs. 1, § 2 Abs. 1 Nr.1 und 3a, Abs. 24 - 26, §§ 22a - 22o, § 36 Abs. 1a KWG Funding Register Statutory Order (RefRegV) of December 18, 2006 »

Act for the Reorganisation of the Federal Financial Administration and the Creation of a Funding Register, Federal Law Gazette I S. 2809 ff. of 28 September 2005 (in German) » Reasons: Deutscher Bundestag, Circulation 15/5852 (in German) »
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