A multifunctional transformer with a rapid response speed, comprising: a closed loop iron core (5); a transformer, which consists of primary and secondary coils (L1, L2; L3, L4) mounted on an iron core column of the closed loop iron core; a saturation reactor, which comprises two sets of coils (L5, L7, L9; L6, L8, L10) which are respectively mounted on two iron core columns of the closed loop iron core. Each set of coils comprises a first alternating current coil, a second alternating current coil and a direct current coil. Dotted ends of the two first alternating current coils (L5, L6) are connected together, and non-dotted ends of the first alternating current coils are both connected to dotted ends of the second alternating current coils (L7; L8) on the other iron core column. Non-dotted ends of the two second alternating current coils are connected to a node N and dotted ends of the two direct current coils (L9, L10) are respectively connected to the dotted ends of the second alternating current coils on
