Talk in the Park

Between a Systemic Crisis and General Suspicion: Ways for Banks to Overcome the Loss of Trust

Dr. Paul Achleitner, chairman of the supervisory board of Deutsche Bank, speaking at the Robert Bosch Stiftung

Stuttgart, March 4, 2013 - The sovereign debt crisis in Europe is not over. Particularly Greece, Spain, and Portugal are struggling with mass unemployment and drastic austerity measures. Only a bailout by their EU partners prevented a national bankruptcy in these nations. These national budget crises are the long-term consequence of the financial crisis in 2008, when the governments were forced to save systemically relevant banks with billions of
euros from tax revenue to prevent the real economy from crashing.

And today bankers continue to draw criticism from the public. Many see the cause of Lehman Brothers bankruptcy and the subsequent downward spiral as a result of the bankers’ quest for increasingly higher profits and bonuses. Yet every country needs a functioning financial industry. Without banks to provide reliable money transfer and professional loan services, the real economy would not function either.

So how can banks win back people’s confidence and trust? Has anything really changed behind the banks’ grand facades? This is what Dr. Paul Achleitner, the chairman of the supervisory board of Deutsche Bank, spoke about during the Talk in the Park at the Robert Bosch Stiftung. The title of his talk was “Between a Systemic Crisis and General Suspicion: Ways for Banks to Overcome the Loss of Trust.”

At first Dr. Achleitner explained the importance of the financial sector to the economy. Balancing out risks, providing capital for large investments, and securing money for retirement are all key jobs carried out by banks, and are a prerequisite for our prosperity.

In order for the financial institutions to fulfill this duty, they need the trust and confidence of their customers. Dr. Achleitner openly stated that this trust has been shaken, particularly in Deutsche Bank as a result of legal proceedings, the accusation of interest rate manipulation, and excessive salaries. Fundamental changes are necessary in the culture, business model, and structure of banks. But these changes need to be given time and discussed in public.

Dr. Achleitner compared this to the industrial revolution during the 19th century. Similarly to the financial revolution, this revolution led to fundamental social changes, both positive and negative. And just like during industrial capitalism’s heyday, in the past few decades of financial capitalism we have seen unacceptable behavioral patterns: from personal enrichment to the exploitation of weaker entities right down to illegal activities. The problems of the industrial revolution were solved through the combination of legal frameworks, social pressure, and personal responsibility. This, Dr. Achleitner indicated, could also be a model for dealing with the problems in the financial industry. But the key is not to replace the system in its entirety and not to overlook the fact that well-meant interventions by the government can also have unintended side effects.

Picture Gallery

Photos: Robert Thiele
Andreas Stoch and Roland Berger
Franz Fehrenbach, Dr. Paul Achleitner, and Dr. Frank Heintzeler
Dr. Paul Achleitner, chairman of the supervisory board of Deutsche Bank
Guests from the worlds of politics, society, culture, business, and science
Andreas Stoch, Roland Berger, Gaby Fehrenbach, Franz Fehrenbach, Dr. Paul Achleitner, and Dr. Kurt W. Liedtke
Dr. Kurt W. Liedtke, chairman of the board of trustees of the Robert Bosch Stiftung
Dr. Paul Achleitner, Tilmann Todenhöfer, and Susanne Offenbach
Wolfgang Chur and Claudia Diem
Dr. Ingrid Hamm, executive director of the Foundation, and Andreas Stoch

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