Christian Sewing, the CEO of Deutsche Bank and at the same time the President of the BdB banking association, finds clear words about the regulatory requirements for the banking industry.

“It was and will remain the right thing to do to regulate big banks with particular care,” said Sewing at the banking summit that took place in Frankfurt - Sewing, however, was connected from London.

"In Europe, however, we have done a lot at the same time to prevent banks from growing at all."

Inken Schönauer

Editor in business, responsible for the financial market.

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But that is a questionable course, as the importance of size in the financial world is increasing exponentially.

“It cannot be in our interest that all these global banks are based outside of Europe.” In an increasingly fragmented world dominated by national interests, we would make ourselves even more dependent on American banks.

Based on the experience of the past few years, this would be a strategic mistake that is not in the national or European interest.

First get fit

Sewing fueled the discussion about a European bank consolidation at the same time, but tried to take Deutsche Bank out of the running. “It's still too early for us.” The largest German financial institution is not scratching its feet, but wants to get fit first and focus on its own strategy. “The best preparation is to be fit yourself.” Deutsche Bank is on the right track thanks to the restructuring that began around two years ago. The Deutsche Bank boss renewed the announcement that he would propose a dividend to the Supervisory Board in 2022 for the 2021 financial year. The Deutsche Bank share hovered around the previous day's closing price at 10.82 euros on Wednesday.

Very often bank managers say that the European banking supervisors want to prevent cross-border bank mergers.

This was countered by Kerstin af Jochnick from the ECB's supervision.

"That's not the case," she said.

Sewing demanded in his speech that regulation must be fair.

To do this, a level playing field would finally have to be created.

This applies, for example, to the capital regulations, which do not take sufficient account of European economic structures.

But this also applies to the securitization market, which in Europe only reaches a tenth of the American market due to regulatory barriers.

That would be an important lever to create leeway in the bank balance sheets.

Fintechs and Big Techs as competition

Sewing is also the so-called shadow banking market a thorn in the side. The regulatory imbalance in competition with fintechs or big techs is just one example of this. Time and again, the tech giants Google, Apple and Amazon are said to have entered the banking business at some point, but not being regulated like banks. Sewing's statement of "same business, same regulation" is used by many bankers.

Tech corporations are already often active at the interfaces to the banking industry, such as payment processing or cloud applications for banks. In the case of Wirecard fraud and the question of who should actually have noticed the fraud, that was a sticking point. BaFin had always talked itself out of the fact that Wirecard was after all a fintech and that they only had the supervision of the very many smaller Wirecard Bank. It should be one of the tasks of the new BaFin boss Mark Branson to address precisely these challenges and to reorganize the supervisory authority. The German finance minister and SPD candidate for chancellor Olaf Scholz also commented on this on Monday evening in a television broadcast. When asked how he should actually still be trusted after the Wirecard debacle, he had said,that the government has now equipped BaFin with competencies that it did not have before. The new boss wants to make supervision one of the best in the world.

Sewing received support in matters of regulation from the CEO of Commerzbank. Manfred Knof, who has been managing the bank since the beginning of the year, said: "We don't need any more, but smarter rules - especially an implementation of the rules suitable for SMEs, the so-called Basel III." A rule would be needed "that does not limit the financial power of the banks". The regulatory-driven costs would have to go down: "Keyword bank levy".

The bank levy is a consequence of the financial crisis. It is intended to prevent taxpayers money from ever having to be used to bail out banks again. The levy had risen continuously over the past few years. Sewing also addressed the topic of sustainability in his speech. The fight against climate change is "probably the greatest challenge facing mankind". The banks would have to align themselves accordingly. But that is not just a duty, but also an opportunity. "Europe could play a pioneering role here," said Wolfgang Fink, who is responsible for Goldman Sachs' business in Germany.

Sewing ignored a question about the processes at the Deutsche Bank subsidiary DWS, which the former head of sustainability has accused of greenwashing. Sustainability is developing in the right direction at Deutsche Bank. "We are very satisfied with the topic."