OREANDA-NEWS. At its meeting on 2 July 2014, the Board of Supervisory Directors of KfW adopted changes to the KfW By-Laws, thereby implementing the governance regulations of the German Banking Act (sections 25c and 25d) at KfW.

Until now, one of the qualifications to be appointed to the Executive Board of KfW has already been appropriate professional qualifications. But starting now, a candidate must possess and evidence qualifications as a managing director in the same way as required at commercial banks. Besides practical and theoretical knowledge of the banking business, this also requires management experience at a credit institution.

Expanded requirements now also apply for members of the Board of Supervisory Directors of KfW. In addition to requiring competency and reliability of the members, the German Banking Act also contains provisions on the number and structure of the governing body's committees and the topics to be discussed therein. These requirements had to be adjusted to the specifics of the KfW as stipulated in the KfW Law. These include, for example, the requirements on the appointments of members to the Board of Supervisory Directors or the power to make final decisions in committees. As a result, the Board of Supervisory Directors will have four committees instead of three in the future, each with clearly defined duties:

The Executive and Nomination Committee is responsible, in particular, for dealing with legal and administrative matters as well as fundamental business and corporate policy issues. It assesses the Executive Board and the Board of Supervisory Directors and chooses applicants for appointments to positions in the Executive Board. It also assists the responsible federal agencies in appointing members to the Board of Supervisory Directors.

The Remuneration Control Committee monitors, among other things, the appropriate structure of the remuneration system for the Executive Board and the employees. It assesses the effects of the remuneration system on risk, capital and liquidity management and advises the Executive and Nomination Committee with regard to the remuneration paid to the Executive Board.

The Risk and Credit Committee advises the Board of Supervisory Directors regarding, in particular, the current and future overall risk tolerance and strategy of KfW. It decides on the approval of loans, operative investments, the raising of funds and swap transactions, in so far as these must be submitted to the committee pursuant to the By-Laws.

The Audit Committee monitors in particular the accounting process and the effectiveness of the risk management system, especially the internal control system and the internal audit system. It monitors the performance of the audits of the annual financial statements and the rapid correction of any errors identified by the auditor. It makes recommendations to the Board of Supervisory Directors regarding the approval of the annual financial statements and the adoption of the consolidated financial statements.

At its meeting on 2 July 2014, the Board of Supervisory Directors of KfW agreed the appointments to the new committees as follows:

a) Executive and Nomination Committee

The Federal Minister of Finance,

The Federal Minister for Economic Affairs and Energy,

Minister President Erwin Sellering (deputy: State Minister Dr Markus Söder),

Norbert Barthle (deputy: Hubertus Heil),

Andreas Schmitz (deputy: Georg Fahrenschon),

Dr Markus Kerber (deputy: Holger Schwannecke) and

Reiner Hoffmann (deputy: Stefan Körzell)

b) Remuneration Control Committee

The Federal Minister of Finance,

The Federal Minister for Economic Affairs and Energy,

Minister President Erwin Sellering (deputy: State Minister Dr Markus Söder),

Norbert Barthle (deputy: Hubertus Heil),

Andreas Schmitz (deputy: Georg Fahrenschon),

Dr Markus Kerber (deputy: Holger Schwannecke) and

Reiner Hoffmann (deputy: Stefan Körzell)

c) Risk and Credit Committee

The Federal Minister of Finance,

The Federal Minister for Economic Affairs and Energy,

The Federal Minister for the Environment, Nature Conservation, Building and Nuclear Safety,

The Federal Minister for Economic Cooperation and Development,

Minister Dr Nils Schmid (deputy: Senator Dr Ulrich Nußbaum),

Bartholomäus Kalb (deputy: Dr Gesine Lötzsch),

Carsten Schneider (deputy: Hubertus Heil),

Jan Bettink (deputies: Joachim Rukwied, Holger Schwannecke),

Hans-Dieter Brenner (deputies: Joachim Rukwied, Holger Schwannecke),

Georg Fahrenschon (deputies: Joachim Rukwied, Holger Schwannecke),

Gerhard Hofmann (deputies: Joachim Rukwied, Holger Schwannecke),

Andreas Schmitz (deputies: Joachim Rukwied, Holger Schwannecke),

Anton F. Börner (deputies: Joachim Rukwied, Holger Schwannecke),

Dr Martin Wansleben (deputies: Joachim Rukwied, Holger Schwannecke) and

Robert Feiger (deputies: Joachim Rukwied, Holger Schwannecke)

d) Audit Committee

The Federal Minister of Finance,

The Federal Minister for Economic Affairs and Energy,

Minister Dr Norbert Walter-Borjans (deputy: Minister Jens Bullerjahn),

Klaus-Peter Flosbach (deputy: Dr Gesine Lötzsch),

Carsten Schneider (deputy: Dr h.c. Jürgen Koppelin),

Georg Fahrenschon (deputy: Jan Bettink)

Gerhard Hofmann (deputy: Jan Bettink) and

Andreas Schmitz (deputy: Jan Bettink)

The changes to the By-Laws and the amended Rules of Procedure will take effect after approval by the Supervisory Authority on 1 August 2014; at the same time, the new appointments to the committees of the Board of Supervisory Directors, which were likewise decided on 2 July 2014, will also become effective.