Act enacted in October 2008 under fast-track procedure with the aim of cushioning any major collapses on the German financial market. It contained provisions on – a guarantee assumption by the Financial Market Stabilization Agency, – recapitalization: in return for a contribution, the SoFFin can acquire equity shares, silent participations or other equity components from companies, and – risk assumption: the SoFFin can acquire risk-bearing securities acquired by institutions before October 13, 2008 (the day the Act came into force) in return for the transfer of government debt instruments. In principle, these measures targeted the liability side of the bank balance sheet; an estimated EUR 200 billion of toxic paper on the asset side remained a problem to be addressed by further steps. – See bad bank model, German, bank bail-in, balance sheet adjustment, financial crisis, financial market stabilization agency, papers, toxic, stability fund, European, subprime crisis – Cf. Monthly Report of the Deutsche Bundesbank of August 2009, pp. 79 ff. (effects of measures on government debt), ECB Monthly Report of July 2011, p. 91 ff. (EU framework for crisis management in the financial sector), Deutsche Bundesbank Annual Report 2012, p. 97 (draft crisis management for troubled institutions; p. 100: Third Financial Market Stabilization Act).
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University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec.
Professor Dr. Eckehard Krah, Dipl.rer.pol.
E-mail address: info@ekrah.com
https://de.wikipedia.org/wiki/Gerhard_Ernst_Merk
https://www.jung-stilling-gesellschaft.de/merk/
https://www.gerhardmerk.de/