Good progress has been made in response to the FSAP recommendations

Although the German authorities did not initiate a comprehensive review of supervisory
practices to identify the key supervisory lessons from the financial crisis, various individual
elements of microprudential supervision have been evaluated and strengthened in recent
years.

In particular, the stress testing framework and coverage for banks and insurance
companies has been enhanced, the regulatory reporting framework for both sectors has
improved, and the intensity of on-site supervision for larger banks has increased. It is
important, in this context, to recognise the role that regulatory initiatives at both global and
European level have played in shaping the direction and pace of reforms in Germany.