Governments and international regulatory authorities must seek to reach a timely consensus on the key elements of proposed bank regulatory reforms, said Dr. Josef Ackermann, Chairman of the Institute of International Finance (IIF) Board of Directors, at the IIF’s Spring Membership Meeting today in Vienna.

Speaking at a press conference at the meeting, Deutsche Bank’s Chairman of the Management Board and of the Group Executive Committee said, "We consider the direction of regulatory reform to be broadly right. Our efforts, including the reports we have recently published and our new report today on the cumulative economic impact of reform proposals, have the goal of helping to attain our shared objectives."

Ackermann outlined three "critical issues" that he said must "be carefully considered as we move towards the time when key decisions are going to be made." First, the overall package of financial regulatory reforms must be balanced, technically sound, properly calibrated and aimed at increasing market resilience. Second, once a package had been formulated, the timing of its introduction and the phasing of its implementation will be critical. And third: "It is imperative that new regulatory reforms be globally coordinated in terms of both their formulation and the timing of their implementation," he said. "We look to the forthcoming G20 Summit (in Canada this month) to reaffirm this commitment to global coordination."

An interim report (attached below) on the cumulative economic impact of regulatory reform, published today by the IIF, raises important issues about the possible effect of regulatory reforms in adding to the costs of bank borrowing, as well as underlining the importance of the timing of implementation, Ackermann said. "We have shared fully our methodology, data and results with the official sector, which is engaged in a similar study, and we look forward to seeing the results of these efforts and exchanging views at a technical level. Our analysis is designed to contribute to the conversation in the official sector that places issues of regulatory reform within the framework of global economic and market developments."

In conclusion, Ackermann said it was important to emphasize that banks recognized the responsibility they had in contributing to the crisis. "It is imperative that we continue to strengthen our operations and avoid the deterioration of business practices that characterized the period preceding the crisis," he said, adding, "In the coming months we will seek to deepen the dialogue with the official sector. We are convinced that the right package of reforms, introduced on a realistic timescale will bring real benefits to the global economy and we are committed to working together with policy makers to achieve this."

Additional information:

Interim Report on the Cumulative Impact on the Global Economy of Proposed Changes in the Banking Regulatory Framework [PDF / 1.1 MB]