BaFin

BaFin, short for Bundesanstalt für Finanzdienstleistungsaufsicht, is the federal financial regulatory authority of Germany. It supervises banks and financial services institutions, insurers, and the trading of securities, with duties including consumer protection, market integrity, and financial stability.

BaFin was established in 2002 through the merger of three predecessor agencies: the Federal Banking Supervisory Office (BAKred), the Federal Insurance Supervisory Office (BAV), and the Federal Securities Supervisory Office (BAW). It operates as an independent federal authority under the supervision of the Federal Ministry of Finance, with its headquarters in Bonn and additional offices in Berlin.

The authority issues licenses, conducts risk-based supervision, and can impose measures or penalties on supervised entities. It enforces anti-money laundering and counter-terrorist financing rules and cooperates with European regulators and the European System of Financial Supervisors (ESFS), including the EBA, ESMA, and EIOPA, to implement EU directives such as CRD IV, Solvency II, MiFID II, and PSD2. BaFin also engages in consumer protection through product oversight, disclosure requirements, and publishing enforcement actions.

In recent years, BaFin has faced scrutiny related to the Wirecard scandal, highlighting challenges in supervisory effectiveness. The agency has since emphasized strengthening early-warning capabilities, cross-border cooperation, and ongoing reform of its oversight practices to adapt to evolving financial markets.