BaFin, the German financial supervisory authority, has ordered Eurex Clearing, which is operated by Eurex and owned by Deutsche Börse, to take the necessary steps to improve risk management and safeguard its internal organisation.

The regulator has ordered Eurex Clearing to secure its business structure according to section 25a Paragraph 2 of the Banking Act (Kreditwesengesetz - KWG), and Section 45b Paragraph 1 of the KWG.

Section 25a and Section 45b of the Banking Act regulates the organisation of institutions, defining business strategies, risk management, internal control processes, and measures to take to fend off risks, among other things.

BaFin has taken action against Eurex Clearing according also to Section 45b (1) and section 25h paragraph 5 of the KWG giving to the supervisory authority the power to order an institution to reduce risks.

In all these cases BaFin ordered Eurex Clearing to report regularly to BaFin and the Deutsche Bundesbank on the progress made in rectifying the ongoing issues, it said in a note.

A special audit revealed shortfalls in business organisation within Section 25a (1) of the KWG, and in terms of appropriate risk management and internal security measures within Section 25h (1) KWG.

APK opts for minimum interest rate on pensions

Aargauische Pensionskasse (APK), the Swiss pension fund for the employees of the Aargau canton, has decided to apply the minimum interest rate of 1% on pensions assets saved by members in 2023.

The decision to apply the minimum interest rate, set by the Federal Council for occupational pensions, is the consequence of a very difficult year in the market and for returns, the scheme explained.

APK’s investment strategy returned -9.41%, as of the end of September, against a benchmark of -9.50%. In 2021 the pension fund recorded returns of 7.51%.

APK’s portfolio returned -2.64% in the first three months of 2022, -5.11% in the second quarter, and -1.95% in the third quarter last year, it said.

The scheme is also cutting the conversion rate used to calculate pension payouts – Umwandlungssatz – to 5% by the end of 2023.

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Luigi is IPE's Berlin-based DACH correspondent. His coverage includes regulation and the latest pensions and investments trends, and, being a native Italian, he also covers Italy’s pensions market. He has reported from Italy and Germany on international politics and business for European and US publications including USA Today, Bloomberg BNA and for the investigative magazine L’Espresso. He was previously Germany correspondent for Mergermarket covering M&A.View full Profile

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