Shadow banking system: small in Germany, but globally active  The search for additional risk factors which contributed to the financial crisis inevitably leads us to the shadow banking system, which, as we know, played a major role in the spill-over of the subprime exaggerations from the USA to Germany and Europe.
The Financial Stability Review first explains the structures in Germany, distinguishing between shadow banking entities and shadow banking activities. The largest entities by far in the German shadow banking system are open-end mutual funds. Three-quarters of the total is attributable to specialised funds for institutional investors. By contrast, money market funds and hedge funds play only a minor role.