German Finance Minister Wolfgang Schaeuble wants governments to keep scrutinizing the banking sector despite complaints that they have already gone far enough, daily Handelsblatt reported.
Banks remained very creative in circumventing regulation and while stricter bank capital rules would lead to more stability in the sector, they were not enough, the newspaper quoted Schaeuble as saying.
“I know the banks think ‘that’s enough now’,” he told Handelsblatt. “But as I said for example a few days ago to Deutsche Bank chief Juergen Fitschen: it wasn’t countries that unleashed the crisis, it was the financial sector! Therefore there can be no end in regulating.”
Speaking in Berlin on Wednesday evening, Deutsche’s Fitschen responded: “It’s unacceptable for people to stand there and say that banks are still circumventing the rules.”
Fitschen, in his capacity as head of Germany’s BdB banking association, also said in a statement that saying hardly any progress had been made on regulation overlooked the “far-reaching changes of recent years.”
He said many regulatory measures such as higher capital and liquidity requirements, stricter remuneration rules, a single wind-up agency and the banking union were in the works or were already being implemented.
Schaeuble said that while he would continue to fight for the introduction of a financial transaction tax in the European Union, he was skeptical such a tax would raise the hoped-for funds “in the foreseeable future”.
As a result, the 2 billion euros ($2.7 billion) that the tax is meant to raise annually from 2015 according to the ministry’s medium-term finance plan were not taken into account in coalition negotiations between Chancellor Angela Merkel’s conservatives and the Social Democrats. [Reuters]