6.5 Profit-sharing Arrangements 307a minimum interest rate. A silent shareholder has controlling rights and a limited
right to inspect the company’s accounts.^113
A silent participation is not a partnership agreement. A silent shareholder is
thus not liable towards creditors. On the other hand, the silent shareholder and the
company may agree on subordination and/or how the silent shareholder partici-
pates in the losses of the company.
In the event of bankruptcy, the silent shareholder may raise a claim for its capi-
tal contribution reduced by his share of losses.
Commerzbank, the second-biggest bank in Germany, accepted a capital injection from the
government rescue fund (SoFFin, Sonderfonds Finanzmarktstabilität, Germany’s Financial
Markets Stabilisation Fund founded under the Financial Markets Stabilisation Act) in a bid
to stabilise its capital base after losses mounted in 2008. SoFFin’s silent participation of
€8.2 billion was used to increase Commerzbank’s Tier 1 capital (core capital).^114 As the
participation was silent, the Federal Republic neither became a shareholder nor was given
formal management powers or board memberships. Shares in the bank were still owned by
its existing shareholders and the bank was managed by its existing board. De facto powers
could, of course, not be excluded. The agreement with SoFFin stipulated that Commerz-
bank was prohibited from paying any dividends in 2009 and 2010. There was a cap on the
salaries of members of the management board, and bonuses for 2008 and 2009 would not
be granted.
(^113) § 233 HGB.
(^114) In addition, SoFFin granted Commerzbank Group guaranteed funding commitments;
SoFFin promised to guarantee newly issued debt or other liabilities of Commerzbank up
to 31 December 2009 to a total amount of €15 billion.