BaFin President: German banking system relatively robust
The debt crisis had developed in the second half of last year as one of the main risks to financial stability in Europe, said Dr. Elke König, President of the Federal Financial Supervisory Authority (BaFin), at today's press conference, the BaFin. "We know, we have invested in the extent to which German banks in bonds of the peripheral countries of the euro zone," added King. On speculation about future fiscal policy in Greece they do not participate. She was sure, however, that German banks are now prepared for all possible scenarios. "Their exposures to Greece are certainly limited." The German banking system is relatively robust, could be on the developments in the area but of course not completely insulate well, King said, referring to the difficult refinancing conditions of some banks in the euro zone. The two three-year tender from the European Central Bank (ECB) meant for the banks most of all: time - time that they would use to solve their problems and regain market confidence. And above all - -. The highly indebted countries, however, not only asked the banks, but also had the sovereign debt crisis is also not a walk for the German insurer. In the portfolios of insurers befänden also bonds of the peripheral countries of the euro zone - and of course the banks of these countries. "But does the commitment of the German insurer in these bonds is within manageable limits," said BaFin President. A problem that makes the insurance sector to create still is, the continued low interest rates. For the banks, but also for the indebted countries meaningful, if not necessary, an easy money policy by the ECB have been doing for quite some time, bring the insurer into trouble. Especially hard hit were the life insurer. The profitability of their investment portfolios will still be sufficient for several years to redeem the pledge given guarantee. The new system was problematic for some time. "We have to wait and see if the insurance company to turn to other types of investments that promise a better return with acceptable risk. Noticeable changes to the existing conservative investment policy of the German life insurers towards riskier investments we observe at any rate so far is not, "explained King. With regard to the regulation of central counterparties, "central counterparties" said King, "The CCP is a special significance in the overcoming the financial crisis attributed. "They would comprehensively and more stringently regulated in the future. These schemes are very useful, they are a panacea but probably not. "Through the central clearing house to curb contagion, and it prevents markets dry up - and this is one lesson of the Lehman crisis. Above all, the derivatives trading becomes more transparent, "said King. Because a significant proportion of the derivatives market would be transferred from the lack of transparency over bilateral trade derivatives on the future comprehensively regulated and supervised CCPs. More transparency will there be but only if it succeeded in preventing it comes to alternative movements that are offered so instead of clearing efficient standardized products are often non-standardized derivatives contracts. "CCPs are a useful way to more transparency and certainty in the derivatives market," concluded King together. "They hold, however, in turn risks due to their size and complexity, and because the derivatives business is concentrated there -" "is also a problem here," Too big to fail, since you have chosen the path of a new market infrastructure for derivatives trading, must Now you do everything by supervisors to ensure CCPs their intended future role of reliable
