Financial Wealth Ideas

The investment scope of the German economy is very specific in comparison with other countries. This is due to the special role of banks, which are in play. Even those institutions that are intended to provide investment through the securities market, subject to the same laws as the banks. The basis for the operation of investment funds in Germany is the Act on Investment Companies (KAGG), since these companies manage investment funds. Under this law, investment companies are lending institutions, and are subject to all laws relating to credit institutions. Thus, the management company is subject not only to the requirements of KAGG, but inevitably the more stringent standards of the Law on Credit Institutions. " Therefore, investment companies are subject to supervision by the Federal Office for Supervision of credit institutions. Another important characteristic of the German investment fund is the depository of their specificity - the structures that are responsible for safekeeping of securities and the monitoring of the fund management companies. Depositaries of the funds may only be the same banks. As a result, compared with Anglo-Saxon countries, in Germany at the expense of equity-financed markedly lower share of investment. For specific weight of capitalization to GDP (20-25%) in Germany for more than 2-fold inferior to the U.S. and up to 5 times - Great Britain. Most of the needs of large enterprises in the long-term capital satisfy the banks. Another result of the dominant role of banks and banking legislation in Germany was that German regulation of investment companies is considered one of the most stringent in the world when it comes to the legal protection of investors.