The SoFFin (Sonderfonds Finanzmarktstabilisierung - Special Financial Market Stabilization Funds) is a program of the

German government The Federal Government (, ; abbr. BReg) is the chief executive body of the Federal Republic of Germany and exercises executive power at the federal level. It consists of the Federal Chancellor and the Federal Ministers. The fundamentals o ...

with the purpose to stabilize and restore confidence in the financial system. It was created during the

2008 financial crisis The 2008 financial crisis, also known as the global financial crisis (GFC), was a major worldwide financial crisis centered in the United States. The causes of the 2008 crisis included excessive speculation on housing values by both homeowners ...

on October 17, 2008 by the

German Parliament The Bundestag (, "Federal Diet") is the lower house of the German federal parliament. It is the only constitutional body of the federation directly elected by the German people. The Bundestag was established by Title III of the Basic Law for ...

and enacted on October 20, 2008. As of December 31, 2010, it stopped offering new services but continued managing existing guarantees. In November 2011, it was announced that it would be revived for potential new issues if necessary. Initially it was established as an agency of the

Deutsche Bundesbank The Deutsche Bundesbank (, , colloquially Buba, sometimes alternatively abbreviated as BBk or DBB) is the National central bank (Eurosystem), national central bank for Germany within the Eurosystem. It was the German central bank from 1957 to 19 ...

and was supervised by the federal ministry of finance. The fund was managed by Dr. Hannes Rehm (speaker), Dr. Christopher Pleister and Gerhard Strattthaus. Operations were conducted through three tasks: * Providing Liquidity by means of guarantees for specially issued debt by eligible financial institutions * Investing in Equity (

recapitalization Recapitalization is a type of corporate reorganization involving substantial change in a company's capital structure. Recapitalization may be motivated by a number of reasons. Usually, the large part of equity is replaced with debt or vice versa. ...

) * Purchasing securities in

open market operation In macroeconomics, an open market operation (OMO) is an activity by a central bank to exchange liquidity in its currency with a bank or a group of banks. The central bank can either transact government bonds and other financial assets in the ope ...

s The SoFFin may grant guarantees of up to 400bn euros and recapitalize or purchase assets for an additional 80bn euros. In January 2011 the SoFFin was reorganized under the then created German Agency for the Stabilization of the Financial Markets. Since the end of 2015, it has no longer been possible to apply for aid measures from it. Instead, the FMS manages the holdings that have existed since then and is endeavoring to reduce them. In its stabilization function, the FMS was replaced by the new Single Resolution Fund of the European bank resolution mechanism. At the beginning of 2018, the Financial Market Stabilization Fund was integrated into the Federal Republic of Germany - Finance Agency

GmbH (; ) is a type of Juridical person, legal entity in German-speaking countries. It is equivalent to a (Sàrl) in the Romandy, French-speaking region of Switzerland and to a (Sagl) in the Ticino, Italian-speaking region of Switzerland. It is a ...

SoFFin guaranteed issues

SoFFin Equity recapitalizations

References

External links

*{{in lang, de, en}
Official site of the SoFFin
Banking in Germany German economic policy Great Recession 2008 establishments in Germany 2018 mergers and acquisitions

SoFFin guaranteed issues

SoFFin Equity recapitalizations

See also

References

External links