Germany's development agency for agribusiness
Rentenbank provides refinancing to banks within the European Union involved in financing agriculture, related sectors thereof and rural areas. The bank focuses on granting standard promotional loans as well as special promotional loans at particularly favourable interest rates for agribusiness and rural areas in Germany.
The funds for refinancing of promotional lending are raised through borrowings or the issuance of securities on domestic and international capital markets. Within the bank's international funding activities, the € 60 billion Euro Medium Term Note (EMTN) program, launched in 1994, as well as the € 20 billion Euro Commercial Paper (ECP) program, launched in 2000, play important roles.
In 2001, the bank started the issuance of global bonds registered with the U.S. Securities and Exchange Commission (SEC). The SEC registration was achieved under the "Schedule B" of Section 7 of the 1933 Securities Act, which is only available to sovereign and quasi-sovereign issuers. Domestic bond issuance documentation in several countries such as Australia, Canada, Japan, New Zealand and Norway further diversifies the bank's international funding sources. In addition, Rentenbank has an excellent access to the domestic investor base with registered bonds (Namensschuldverschreibungen) and promissory notes (Schuldscheindarlehen).
Rentenbank's long-term obligations are triple A-rated by Moody's Investors Service, Standard and Poor's and Fitch Ratings. The ratings reflect the maintenance obligation (Anstaltslast) of the Federal Republic of Germany which ensure full payments on all obligations. In addition to the Anstaltslast, the bank benefits from the Guarantee of the Federal Republic of Germany, which came into effect on January 1st, 2014 and covers all existing and future liabilities of Rentenbank. The guarantee was added to Rentenbank's Law in response to stricter requirements under Basel III rules. The ratings also take into account the low risk of the bank's loan portfolio, its stable profit and strong capitalization.
Rentenbank is a public law institution, which was set up by statute in 1949. The German federal government exercises supervision through the Federal Ministry of Food and Agriculture which makes its decisions in concert with the Federal Ministry of Finance. On November 4, 2014, the European Central Bank (ECB) has taken over banking supervision from the Federal Financial Supervisory Authority (BaFin). The basis of the bank's capital was formed by contributions paid in by the German agricultural and forestry sector between 1949 and 1958. Therefore, any unappropriated profits, which remain after allocations to reserves, may only be used to promote agriculture.