Bank accounting

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The bank accounting is the accounting for banks, more precisely for all credit institutions . It differs significantly from the accounting of non-banks , which do not conduct typical banking business. As part of the bank accounting , a balance sheet is drawn up in which credit institutions must observe specific accounting standards. The annual financial statements of a credit institution include the balance sheet, the profit and loss account and the notes .


In Germany, non-banks and credit institutions are generally subject to the accounting regulations of the Commercial Code and - in the case of the legal form of a stock corporation or partnership limited by shares - also to the Stock Corporation Act . Internationally, the accounting standards of the International Accounting Standards Board (IASB) apply to all companies , provided that the accounting companies act as securities issuers on an organized capital market . According to the EU's IAS regulation of July 2002, they are obliged to apply the International Financial Reporting Standards (IFRS) to their consolidated financial statements since 2005 . The International Financial Reporting Standard 7 in particular applies to credit institutions .

Schematic example of a bank balance sheet

Active side Passive side
  1. Cash reserve / cash register (including minimum reserve )
  2. Claims on credit institutions
  3. Receivables from customers (customer loans)
  4. Bonds
  6. Holdings
  7. Shares in affiliated companies
  8. Other assets ( property, plant and equipment )
  9. Prepaid expenses

( total assets )

  1. Liabilities vs.. Central bank
  2. Liabilities to Credit institutions
  3. Liabilities to Customers ( sight deposits on current accounts , overnight money , savings deposits , time deposits )
  4. Securitized liabilities ( savings bonds , Pfandbriefe , bank bonds )
  5. Treuhand u. other liabilities
  6. Accruals and accruals
  7. Subordinated Liabilities
  8. Profit participation capital
  9. Fund for general banking risks
  10. Equity ( subscribed capital, etc.)

( total assets )

Differences from non-bank accounting

In addition to these general accounting regulations, credit institutions must also observe the provisions of Sections 340 ff. HGB and the Financial Institutions Accounting Ordinance (RechKredV) that apply specifically to them . This results in formal and material differences from accounting for non-banks.

Material regulations

Sections 340 to 340o of the German Commercial Code (HGB) contain supplementary regulations for credit institutions and financial services institutions that take into account the particularities of the banking industry . Section 340a of the HGB regulates which provisions of the HGB also apply to the banking industry and which do not (Section 340a (2) HGB). Section 340b HGB deals with repurchase agreements if they fall under the legal definition codified here . Section 340c HGB contains provisions on the profit and loss account and the notes, according to Section 340d HGB the remaining term is decisive for the breakdown of the deadlines, Section 340e HGB deals with the valuation of assets , Section 340f HGB deals with the provision reserves, Section 340g HGB deals with the "Fund for general banking risks ”, § 340h HGB contains regulations on currency conversion , § 340i HGB regulates the size-independent obligation to prepare consolidated financial statements , § 340l HGB regulates the disclosure obligations , the rest contains penalties for violations.

Formal regulations

The Financial Institutions Accounting Ordinance (RechKredV) provides for a different order and a more precise deadline structure than for non-banks. Bank balance sheets follow the classification scheme prescribed in § 2 RechKredV and are based on the principle of liquidity on the assets side , so that assets begin with the most liquid balance sheet items such as cash reserves and cash on hand . While in the case of non-banks, § 285 No. 1a HGB only differentiates between short and long-term terms for receivables and liabilities , these balance sheet items are subject to more precise deadlines according to § 9 Paragraph 2 RechKredV (<3 months,> 3 to 1 year,> 1 to 5 years and> 5 years). According to § 2 RechKredV, in deviation from § 275 of the German Commercial Code (HGB ), credit institutions must prepare the profit and loss statement using special forms, whereby the account or graduated form is permissible. The reason for this is the characteristic that banks do not generate revenue like non-banks, but predominantly interest income ( Section 28 RechKredV), which must be compared with the interest expenses ( Section 29 RechKredV). According to § 34 RechKredV, additional explanations must be given in the appendix, § 35 RechKredV requires additional mandatory information .

Liquidity and cash reserve

The balance sheet provides information on how quickly and with what financial losses assets can be liquidated if necessary. This is known as static liquidity . As a special feature compared to the balance sheets of industrial companies, in which only the item cash is available as a cash reserve, central bank balances such as the minimum reserve balance are also accounted for as cash reserves at banks , even if these are not available at normal times.

Accounting for equity

Equity consists in banks, first of subscribed capital , capital reserves , retained earnings and the balance sheet profit or the net loss . This core Tier addition, banking supervisory yet certain capital instruments under Art. 51 law Kapitaladäquanzverordnung (abbreviation CRR) and supplementary capital pursuant to Art. 62 CRR recognized as own funds.

Provisional reserves and cross-compensation

According to Section 340f (1) of the German Commercial Code (HGB), credit institutions may value claims from the lending business , bonds and shares (which are neither part of the financial assets nor the trading book , i.e. only affect the banking book ) at a lower book value than the book value resulting from the strict lower of cost or market principle , provided this reasonable commercial judgment is permissible. The provision reserves must not exceed 4% of these balance sheet items. Further details do not need to be made in the annual financial statements (Section 340f (4) HGB). This results in an improvement in the eligible capital because the provision reserve is recognized as supplementary capital (Art. 63 (1) CRR gives the member states an opening clause for “other items”).

Income and expenses from other securities and receivables are all income and expenses that arise in connection with the securities portfolio of the liquidity reserve and the lending business and do not represent interest income or current income. Here is a cross-compensation instead. If cross-compensation is used, it cannot be seen in the annual financial statements whether and to what extent provision reserves have been created or dissolved.

This is different from IAS . Here, risk provisioning relates exclusively to the valuation result in the lending business. As a net figure, it contains the balance of depreciation , value adjustments and provisions for latent and discernible risks and the income from the reversal of these items. There is no possibility of creating reserves , either for loans or for securities.

Accounting for financial assets


A bond is accounted for either under bonds and other fixed income securities or under loans and advances to customers .

Depending on whether a bank issues bonds, they are accounted for differently. If a bank buys bonds, they are listed under the above Item accounted for. However, if a bank issues bonds itself, these must be listed in liabilities under liabilities to customers .

Positions below the balance line

This includes business transactions that cannot be accounted for but which, after the next balance sheet date , can trigger a liability , a possible obligation ( credit risk ), a loss or a profit for the financial institution preparing the balance sheet . A claim is likely; As soon as it becomes specific, a provision must be made for impending losses from pending transactions . The position is on the liabilities side of the balance sheet.

They can be further subdivided into:

In Appendix further information is required.

Special evaluation regulations

The following valuation rules apply to banks:

Profit and Loss Account

The account form of the income statement results from § 340a HGB and replaces the provisions of § 275 HGB - applicable to non-banks - further details are regulated by § § 28 ff. RechKredV . The P&L is structured as follows for credit institutions:

expenditure Income
  1. Interest expenses
  2. General administrative expenses
  3. Depreciation
  4. Extraordinary expenses
  5. Taxes
  6. Annual surplus

(sum of expenses)

  1. Interest income
  2. Current income
  3. Income from write-ups
  4. Other company income
  5. extraordinary income
  6. Annual deficit

(total income)

The P&L can be further characterized using important items. A distinction is made between net interest income, trading income and income from financial investments.

Interest income

The interest result includes, together with interest expenses and interest income, all current expenses and income associated with financial transactions.

Income and expense components for other securities

  • Lending business valuation result
  • Result from securities in the liquidity reserve
  • Netting option

Investment result

The financial investment result includes valuation and disposal results in connection with financial investments, i. H. Participations, shares in affiliated companies and securities treated as fixed assets.

Interest margin

The bank-specific business key figure of the interest margin is calculated from items in the balance sheet and income statement:

An increase in the interest margin does not necessarily lead to an increase in net interest income. An increase in the interest margin can be attributed in particular to a falling balance sheet total with constant net interest income.

An increase in net interest income does not necessarily lead to an increase in the interest margin. If net interest income and total assets change in the same ratio, the interest margin remains constant.

The net interest income is an absolute figure, whereas the interest margin is a percentage figure.

example 1
Net interest income 10, total assets 100, interest margin 0.1
The interest margin increases from 0.1 to 0.2 with constant net interest income and a decrease in total assets to 50.
Net interest income 10, total assets 50, interest margin 0.2
Example 2
Net interest income 10, total assets 100, interest margin 0.1
The net interest income increases from 10 to 20 while the balance sheet total doubles to 200. The interest margin remains constant at 0.1.
Net interest income 20, total assets 200, interest margin 0.1

Interest income account

The interest business is the main part of the banking business. For this reason, in addition to the balance sheet and income statement, an interest income statement is / was submitted to the Bundesbank . For example, a mortgage loan with a volume of 60,000 euros and a share of 30% of the balance sheet total has an interest rate of 5,400 euros at an interest rate of 9%.

In the interest income account, both the interest rate and the volume are broken down according to original maturities as well as customer groups and products.

Calculation of annual net interest income : interest income - interest expenses.

The gross interest margin (interest margin interest margin , margin ) = Interest Income / Balance Total

These are descriptive key figures that do not provide any indication of which projects are useful for achieving the management goal. The reasons for different average values ​​for these key figures can be based on differences in:

are based.

Information functions of bank accounting

Accounting information available prior to the decision enhances these:

  • A bank's depositor needs information about the security of their investment
  • Equity providers depend on information about future corporate development. You bear the entrepreneurial risk.

Information on the extent to which management has safeguarded the interests of the investors - this is about the consequences of decisions that have already been made - enables bank management to monitor the following principal-agent relationships :

  • Depositor versus bank management
  • Management versus shareholders.

Individual evidence

  1. Regulation (EC) No. 1606/2002 of July 19, 2002 on international accounting standards, ABl. EG No. L 243 p. 1
  2. Martin Jonas, The formation of valuation units in the annual financial statements under commercial law , 2011, p. 58