How it works
Liquidity pooling enables the federal government to manage its liquidity. Participating institutions, in turn, can invest surplus liquidity and receive a market-based return on the funds invested, taking into account the federal government’s high credit rating.
Investments are made in the form of euro-denominated money market transactions with varying maturities. Participants in liquidity pooling can invest funds as follows:
- either for an agreed period and interest rate (overnight or term deposits)
- or for an indefinite period with an interest rate to be set daily (so-called “until further notice” funds).
Funds are invested via the Finance Agency, which acts in the name and on behalf of the federal government. The type of investment and the interest rate are agreed with the Finance Agency on a case-by-case basis.
Eligible Parties
Public institutions in this context include, in particular:
- bodies and institutions governed by public law that are directly subordinate to the federal government or the Länder, including foundations,
- institutions or companies governed by private law in which the federal government and/or the Länder and/or the municipalities hold an exclusive stake, including foundations, as well as
- special funds of the federal government and/or the Länder.
The finance agency reviews the application and, if the outcome is positive, refers it to the Federal Ministry of Finance, which decides on the inclusion of the respective institution in the liquidity pooling scheme. The federal government is under no obligation to enter into a contract, as both the Budget Act and the Federal Budget Code limit the volume that the federal government is permitted to borrow.
Contact
Eligible parties may contact the following address for further information on liquidity pooling and to apply to participate:
Bundesrepublik Deutschland - Finanzagentur GmbH
Handel und Emissionsgeschäft
Olof-Palme-Straße 17
60439 Frankfurt/Main
Germany
Ühone: +49 (0) 69 25 616 -1580 or -1581