In the face of fierce international competition, according to Deutsche Bank boss Christian Sewing, Europe needs larger and more competitive banks.

“We must finally use Europe's economies of scale,” warned Sewing on Wednesday at the start of the online “Handelsblatt” banking conference.

“It was and remains the right thing to do to regulate big banks with particular care.

At the same time, however, in Europe we have done a lot to prevent banks from growing up at all.

But that is a questionable course - the importance of size in the financial world is increasing exponentially, ”said the manager, who has also been President of the Association of German Banks (BdB) since July 1st.

Location advantages for the USA

The efficient banking and capital market is one of the great locational advantages of the USA, said Sewing.

“In order to catch up again, Europe also needs a stronger banking and capital market.

Otherwise we will not be able to assert ourselves in a polarized world economy between the USA and China. "

Sewing reiterated his call for progress in the unification of capital markets in Europe. The banking and capital markets union is a necessary condition for a strong financial sector in Europe: “We can no longer afford an evolutionary path, we now need a big leap. This will also accelerate the overdue consolidation across national borders. "

The core of the Capital Markets Union is to remove bureaucratic hurdles between the individual EU states in order to give companies more opportunities to raise money. Consumers should also have more options for cross-border investments. In Europe - in contrast to the USA - loans and financing are mainly granted by banks. The EU Commission's plans for a capital markets union have been on the table since September 2015, but implementation has stalled.

Deutsche Bank wants to complete its corporate restructuring before possible mergers and acquisitions.

“The best preparation for the next step is to be fit yourself.

That's the way it is in sport, and that's the way it is in business, ”said the head of the Frankfurt Dax group.

Sewing again promoted cross-border mergers in Europe.

But the board of directors of Germany's largest financial institution “don't scratch their feet” and don't look around for possible partners, the manager emphasized.

Higher return on equity

Sewing was optimistic that Deutsche Bank will sustainably achieve its own targets for 2022 and drive up the return on equity as planned.

"You should do this homework first," said Sewing.

"If we achieve that, then we will be of the size and strength that we can then perhaps think about other things at eye level."

For cross-border mergers, however, a corresponding framework in Europe is also required.

"Right now there is only one thing for us and that is the completion of our strategy," said Sewing.

“We do everything from our side.

I think it would be good for the entire European banking market.

There is only one thing I can do: prepare Deutsche Bank as well as possible, and I'm very confident of that. "