Misplaced Pages

#916083

35-484: The State Bank of the GDR was responsible for the administration of the internal account settlement and banking system, the issue of money and control of money circulation within the GDR, administration of the exchange control regulations and settlement of foreign currency accounts with overseas companies and governments (Zahlungsverkehr by transfer). In addition, the bank bought and sold financial securities and administered

70-404: A 1% interest rate premium over the nationally determined fixed interest of 3.25% per annum paid on all other consumer saving accounts . However, although the interest rate on these accounts was 4.25% per annum, access to the hard currency in the account was far from easy. Technically the foreign currency on deposit was only available for use during authorised travel to Western countries, and

105-404: A chain of special shops that offered high quality East German goods (that were otherwise difficult to obtain without joining a long waiting list) at reasonable prices and otherwise unobtainable Western consumer goods (usually at near duty-free price levels) – they were accessible only to foreign tourists with hard currency and East German citizens with Forum checks. Forum checks were purchased at

140-483: A long history in European financial services. The basic concept is that of a banking system not based on cheques, but rather by direct transfer between accounts. If the accounting office is centralised , then transfers between accounts can happen simultaneously. Money could be paid in or withdrawn from the system at any post office, and later connections to the commercial banking systems were established, often simply by

175-472: A very short interruption, exchange controls were restored in 1968, relaxed in 1984, and finally abolished in 1989. Francoist Spain kept foreign exchange controls from the Spanish Civil War to the 1970s. Other countries that formerly had exchange controls in the modern period include: Today, countries with foreign exchange controls are known as "Article 14 countries", after the provision in

210-402: Is borne by operators like banks as interbank credit risk, but not by the payer or payee, unlike with cheques or credit cards. This eliminates the need to evaluate the payer's creditworthiness, as transactions can only be initiated with sufficient funds. However, the lack of credit also means the payer has no protection against dishonest payees, and transactions cannot be recalled or disputed. Fraud

245-522: Is easier in interpersonal transactions, so payments should only be made to trusted parties. Additionally, while intra-bank transfers are fast, interbank transfers may take several days unless both parties use an instant transfer system like the UK's Faster Payments or Canada's Interac e-transfer. Modern electronic bill payment is similar to the use of giro. Advantages include: In the United States ,

280-559: The ACH Network , regulated by NACHA and the Federal Reserve Bank , handles all interbank transfers, including direct deposit and direct debit . In entirely electronic bill payment, the payer receives a bill—either physically by mail or electronically from a website ( electronic billing ). Then, the payer reads in the information from the bill, either manually or by using the barcode on the bill (ex: EPC QR Code in

315-531: The Bebelplatz , but eventually built its Berlin headquarters on Pariser Platz . The new owner of the original building was determined to be a subsidiary of Commerzbank. After 1990 the former Dresdner Bank building had mixed fortunes functioning as a local branch of the Dresdner Bank (and featured in the film Run Lola Run ). In 2004 it was converted as part of the real estate project OpernCarrée by

350-595: The International Monetary Fund 's Articles of Agreement, which allows exchange controls only for " transitional economies ". Giro (banking) A giro transfer , often shortened to giro ( / ˈ dʒ aɪ r oʊ , ˈ ʒ ɪər oʊ / ), is a payment transfer between current bank accounts and initiated by the payer, not the payee. The debit card has a similar model. Giros are primarily used in Europe; although electronic payment systems exist in

385-679: The Latin gyrus meaning "gyre" from the Greek gyros meaning "circle". Giro systems originated in Ptolemaic Egypt in the 4th century BCE, where state granary deposits functioned as an early banking system with a central bank in Alexandria accepting giro payments. Giro was a common method of money transfer in early banking . The first occurrences of book money are not known exactly. The giro system itself can be traced back to

SECTION 10

#1732772329917

420-573: The Nordic countries . Direct deposit systems such as those in common use in the United States, by contrast, require the recipient's explicit approval, typically provided by filling out a form. Transferring funds from one personal bank account to another typically requires either a physical check or a wire transfer , which may incur a significant fee and require the paying party to visit the bank. In giro systems, credit risk for currency transfers

455-670: The " bancherii " in Northern Italy, especially on the Rialto (a financial centre, resembling the modern day Wall Street or the City of London). Originally these were money changers sitting at their desk (" bancus " = bench) that customers could turn to. They offered an additional service to keep the money and to allow direct transfer from one money store to another by checking the accounts in their storage books. Literally they opened one book, withdrew an amount, and opened another book where

490-417: The GDR who were in the possession of foreign exchange (typically Deutsche Marks sent by Western relatives or, for a small minority such as writers and artists, overseas royalties earnings) were obliged to deposit this in a dedicated foreign exchange account with the state bank. In order to encourage compliance, and thereby help “drain” the circulation of foreign currency from the economy, these accounts carried

525-751: The United States (e.g., the Automated Clearing House ), it is not possible to perform third-party transfers with them. In the European Union , the Single Euro Payments Area (SEPA) allows electronic giro or debit card payments in euros to be executed to any euro bank account in the area. The word "giro" is borrowed from Dutch giro and/or German giro , which are both from the Italian giro meaning "circulation of money". The Italian term comes via

560-406: The United States, the rise of electronic cheque clearing (and debit cards as preferred instruments of payment) has made this difference less important than it once was. In some stores in the United States , checks are scanned at the cash register and handed back to the customer. The scanned information is forwarded to a payment processor, which transfers the money using the ACH Network . Unlike

595-706: The amount was added. This handling was naturally a very regional system but it allowed the money to circulate in the books. This led finally to the foundation of the "Banco del Giro" in 1619 (in Venetian , "Banco del Ziro") which gave the blueprint for similar banking systems. The usage in German can be seen in the Banco del Giro founded in Vienna in 1703 (to extend the financing business that Samuel Oppenheimer had brought from Venice in 1670). Postal giro or postgiro systems have

630-414: The bank was privatised by Treuhand and parts of other banks were taken over (see also Deutsche Kreditbank ). The Staatsbank occupied two adjacent urban blocks which before 1945 had been the headquarters, respectively, of Dresdner Bank and of Berliner Handels-Gesellschaft (BHG). Following German reunification, the Dresdner Bank sought restitution of its protected neo-classical building of 1889 at

665-476: The banking model, the postal giro model allows an individual to transfer money directly into another individual's bank account, provided the sender has the recipient's account details. The recipient is not required to approve or acknowledge the transfer or visit the bank to claim it. As a result, cheques are rarely used in countries with extensive giro networks, such as Germany , the Netherlands , Belgium and

700-586: The central bank were completely subservient to policies of the governing Socialist Unity Party of Germany . The State Bank of the GDR was also a member of the International Bank for Economic Co-operation , a Comecon organisation founded in 1957 with its headquarters in Moscow . The nominal currencies used for trading, international clearing and settlement purposes by this organisation were transfer roubles and gold reserves. After German reunification

735-428: The cheque to their bank. The cheque must then be cleared , a complex process by which cheques are sorted once, mailed to a central clearing location, sorted again, and then mailed back to the paying branch, which verifies that the funds are available and pays the payee's bank. In the postal giro model , the paying party sends a request to pay the payee (called a giro transfer ) to the giro centre, which verifies that

SECTION 20

#1732772329917

770-529: The country. Common foreign exchange controls include: Often, foreign exchange controls can result in the creation of black markets in currencies. This leads to a situation where the actual demand for foreign currency is greater than that which is available on the official market. As such, it is unclear whether governments have the ability to enact effective exchange controls. Foreign exchange controls used to be common in most countries. For instance, many western European countries implemented exchange controls in

805-514: The foreign exchange held in the accounts of all those under 65 years old, and limited the usefulness of larger sums to those aged 65 and older. In order to overcome this obvious disincentive to compliance with the internal foreign exchange rate regime , the State Bank allowed hard currency to be exchanged for Forum checks – a form of internal currency ( foreign exchange certificates ) that (crucially) could be spent at an Intershop . These were

840-459: The funds are available, debits the payer's accounts by the amount requested, and credits that amount to the payee's account. The giro centre then sends the giro transfer document to the payee, and an updated account statement to both the payer and payee. In the case of large utilities receiving thousands of payments per day, statements are sent electronically and incorporate a unique reference number for each payment for reconciliation purposes. In

875-406: The giro as a method of direct payment from remitter to receiver. The term " bank " was not used initially to describe the service. The banks' main payment instrument was based on the cheque, which has a totally different remittance model from that of a giro. In the banking model , cheques are written by the paying party and then handed or mailed to the payee, who must then visit a bank or mail

910-570: The holder of a foreign exchange account for such an “internal” GENEX purchase, the cost of the order was debited directly from the account by giro or cheque clearing methods. Although the State Bank was always politically subordinate to the GDR government, this was made explicit by a law of 19 December 1974 which defined the State Bank as an organ of the Council of Ministers of the German Democratic Republic and formalised

945-524: The hotelier Sir Rocco Forte into a luxury hotel (the Hotel de Rome). The hotel opened on 12 October 2006. The former BHG has become the Berlin seat of the public development bank KfW . Exchange control Foreign exchange controls are various forms of controls imposed by a government on the purchase/sale of foreign currencies by residents, on the purchase/sale of local currency by nonresidents, or

980-654: The local bank opening its own postgiro account. By the middle of the 20th century, most countries in continental Europe had a postal giro service. The first postgiro system was established in Austria in the early 19th century. When the time the British postgiro was conceived in 1968, the Dutch postgiro was very well established with virtually every adult having a postgiro account, and very large and well-used postgiro operations in most other countries in Europe. Banks also adopted

1015-534: The practice of the bank's president being a member of the Council of Ministers. While this stood in stark contrast to the political independence of West Germany ’s Bundesbank it was common during this era for there to be political control over the nation's central bank -–though not usually to the extent found in East Germany and the other Eastern Bloc economies, where the policies and technical operation of

1050-502: The purchase, sale and holding of precious metals for foreign exchange purposes. The state bank was also responsible for the account processing of the state institutions and state enterprises , ( Volkseigener Betrieb ), having at least one main branch in each of the 15 administrative subdivisions of the German Democratic Republic . Another key task of the State Bank (on which it expended considerable resources)

1085-439: The transfers of any currency across national borders. These controls allow countries to better manage their economies by controlling the inflow and outflow of currency, which may otherwise create exchange rate volatility. Countries with weak and/or developing economies generally use foreign exchange controls to limit speculation against their currencies. They may also introduce capital controls , which limit foreign investment in

Staatsbank der DDR - Misplaced Pages Continue

1120-624: The unrealistic rate of 1 East German Mark for 1 Deutsche Mark – the typical black market exchange rate varied from 5 – 10 East German Marks to the Deutsche Mark. In addition, it was also possible for holders of a foreign exchange account to order from the hard currency mail order GENEX catalog (GENEX gift service GmbH). This had originally been established to allow Westerners to legitimately send Eastern relatives Western brand (and export quality Eastern) consumer goods, wines, jewellery, delicacies etc. in exchange for hard currency. When used by

1155-644: The years immediately following World War II. The measures were gradually phased out, however, as the post-war economies on the continent steadily strengthened; the United Kingdom, for example, removed the last of its restrictions in October 1979. By the 1990s, there was a trend toward free trade and globalization and economic liberalization . In France, exchange controls started after the First World War. It then reappeared between 1939 and 1967. After

1190-562: Was attempting to control the circulation of foreign exchange within the GDR. This was primarily because of concerns that the circulation of foreign exchange (particularly the Deutsche Mark ) could lead to the establishment of a parallel currency that would encourage the black market , damage the East German Mark and the internal economy, and undermine the international prestige of the GDR on its own soil. Thus citizens of

1225-537: Was limited to the legitimate foreign currency travel expenses in the country concerned, plus the equivalent of 15 Deutsche Marks per day for other expenses. As the GDR only granted visas to travel to the West in limited circumstances to those below pensionable age (e.g. for weddings, funerals and serious illness of close relatives, business-based attendance at international conferences and trade fairs), and then usually only for very short periods, this effectively “neutralised”

#916083