The Region

Deutsche Bundesbank

Focus on Central Banks

Published September 1, 1997  | September 1997 issue

Headquarters: Frankfurt am Main

National currency: Deutsche mark

The Bundesbank of the Federal Republic of Germany was established as a uniform central bank in 1957 as a successor to a two-tier central banking system, which consisted of the Bank Deutscher Lander and the legally independent regional Land Central Banks.

The Bundesbank is governed by the Central Bank Council, composed of the Bundesbank's president, vice president and up to six other members; members of the Directorate (the central executive body of the bank nominated by the Federal Cabinet and appointed by the president of the Federal Republic) and the presidents of the regional Land Central Banks.

The Bundesbank is:

  • the bank of issue, that is, it has the sole right to issue banknotes.

  • the bankers' bank, providing supervisory oversight, acting as "lender of last resort," providing banking services and maintaining banking system reserves.

  • the principal banker of the federal government, for which it executes payments and assists the federal and regional governments in their borrowing in the capital market.

  • the guardian of the monetary reserves.

The Bundesbank holds reserves mainly in U.S. dollars with banks or central banks abroad, in addition to gold holdings and reserve positions in, and claims on, the International Monetary Fund and the European Monetary Institute.

See more about the Deutsche Bundesbank.