Austria’s finance minister plays down fears of a new banking crisis in the Eurozone, amid persistent concerns about Deutsche Bank’s balance sheets.
CCTV’s Guy Henderson reports. Follow Guy Henderson on Twitter @guyhendersonde
European Central Bank on the defensive as German and Italian giants wobbleAustria’s finance minister plays down fears of a new banking crisis in the Eurozone, amid persistent concerns about Deutsche Bank’s balance sheets. CCTV’s Guy Henderson reports.
Markus Kerber says Deutsche Bank is the subject of a witch hunt. This German economist doesn’t deny the country’s largest lender has problems. But he believes they’re being exaggerated.
However, Mario Draghi, European Central Bank President, doesn’t think so. He was in Berlin on Wednesday to tell his many critics here: Deutsche’s woes are of its own making.
Namely, a possible fine for mis-selling mortgage-backed securities, to the tune of up to $14 billion.
Some believe it may struggle to pay that amount without help, something the bank itself denies.
Particularly since the Brexit vote, Italian banks might often be mentioned as an Achilles heel for the Eurozone, but very rarely German ones. And while it’s not entirely clear how serious Deutsche’s challenges are, the sector here has been saying that for some time it’s coming under increasing pressure.
Kerber blames the ECB, and is in fact suing the bank over its monetary policy.
Wednesday’s announcement that Germany’s Commerzbank will cut thousands of jobs has added to his concerns.
Is Deutsche too big to fail? Some analysts here, Kerber included, say that it’s too early to ask.