le barzellette continuano Sunday, 25 September 2011 -
17:59 Deutsche Bank CEO: Crucial That Euro States Keep Word On July 21 Deal
DOW JONES NEWSWIRES
It is "crucially important" that all euro-zone governments follow through on the agreements reached July 21, Deutsche Bank Chief Executive and Chairman of the Institute of International Finance Board of Directors Josef Ackermann said Sunday.
According to a copy of his opening remarks at a press conference in Washington, Ackermann said that the euro is "an essential and stable pillar of the international monetary system," which has brought members stability and growth.
The currency's "central role" in the international monetary system further necessitates removing uncertainties about the "workability" of the currency's institutional foundations, he said.
"Therefore it is crucially important that all euro-area governments now quickly follow through on the agreements reached in Brussels on July 21," he said. These include approving the EUR440 billion bailout fund, the European Financial Stability Facility, and enlarging its mandate, he specified.
He said, furthermore, that it is "equally important" for member states to agree on measures needed to make economic policies subject to greater discipline.
Turning to the deal on private-sector involvement in the second Greek aid package, also agreed July 21, Ackermann said "we are confident that private investors and creditors will participate strongly in the debt-exchange offer and considerable progress has been made in building support."
He said it was "not feasible" to re-open this deal and added that given its benefits to Greece, "we should focus now on its timely and resolute implementation."
Addressing financial regulation, Ackermann said that the IIF supports the changes in banking regulations agreed last year, known as Basel III.
"However, actions that are now being seen and are being proposed that go beyond Basel III requirements, accelerate the agreed timetable, and create an unlevel international playing field, threaten economic recovery and job creation," he said.
Ackermann warned against excessive regulation of the financial sector, pointing to a recent IIF study, which said that the combined impact of regulatory reforms could lower gross domestic product in mature economies by more than 3% by 2015, which could wipe out the creation of 7.5 million jobs.
He took a swipe at transaction taxes, saying these "would be a costly mistake." He said that both financial stability and economic recovery require credit growth and the ability of the financial sector to extend adequate financing both to governments and enterprises. "This ability is in danger of being severely hampered," he said.
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