BaFin published a general order to lower the countercyclical capital buffer (CCyB) from 0.25% to 0% as of April 01, 2020. This reduction aims to strengthen the resilience of the banking system in the light of COVID-19. A possible increase in the domestic countercyclical capital buffer is likely not expected before January 01, 2021. In line with the ECB decision on dividends, BaFin has also stated that banks should not distribute dividends and profits. BaFin Executive Director Raimund Röseler said, "We expect that the institutions that are under our direct supervision (Less Significant Institutions) will not pay any dividends or distribute profits until at least October 2020." Additionally, BaFin updated its frequently asked questions on banking and securities supervision in response to COVID-19.
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Keywords: Europe, Germany, Banking, Securities, COVID-19, CCyB, FAQs, Dividend Distribution, Less Significant Institutions, Regulatory Capital, BaFin
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