The financial regulator predicts stormy waters for Germany

The logo of Germany’s Federal Financial Supervisory Authority BaFin (Bundesanstalt fuer Finanzdienstleistungsaufsicht) is pictured outside the BaFin office building in Bonn, Germany, April 15, 2019. REUTERS/Wolfgang Rattay

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BERLIN, July 13 (Reuters) – Germany’s financial sector faces an uncertain future amid an energy dispute with Russia, the head of the country’s financial regulator BaFin said in a newspaper interview published on Wednesday.

“I don’t see an acute short-term threat to financial stability – but ask me again in three to six months. Then things might look different,” BaFin chairman Mark Branson told the Sueddeutsche Zeitung.

He warned that the energy crisis will affect the entire German economy, as there is a growing fear that Russia could reduce its gas exports to the country even more.

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“The state can’t absorb everything,” Branson said.

The head of financial supervision pointed to banks struggling with loan defaults, but said that for now the financial system is strong.

“Banks have a lot more capital than they used to have as a buffer against losses.”

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Written by Rachel More, edited by Kirsti Knolle

Our Standards: The Thomson Reuters Trust Principles.

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