* Bankers warn regulators not to imperil recovery
* Say lack of coordination and regulation cluster a threat
* Bankers accept responsibility for role in crisis
(Writes through. Adds Raiffeisen CEO, IMF MD quotes)
By Edward Taylor
FRANKFURT, Nov 19 European bankers are growing
increasingly vocal in their opposition to what they view as
regulatory overkill in response to the financial crisis.
They have largely swallowed the new Basel III framework,
which is designed to ensure lenders have enough capital to
withstand future downturns. But there are signs of rebellion as
global banking supervisors plot other ways to tighten the
regulation of those blamed for exacerbating the crisis.
Banks in Europe say too much red tape will prevent them from
providing much-needed financing to companies, thereby killing
off a nascent economic recovery.
"We can cope with Basel III, but we don't need the
gold-plated rules that come on top right now," Klaus-Peter
Mueller, supervisory board chairman of Germany's second-biggest
lender Commerzbank (CBKG.DE) said on Friday.
Mueller's view was echoed by the chief executive of
Austria's Raiffeisen International RIBH.VI.
"The problem is that regulation is suffocating. We are being
flooded with regulation and at the same time it is expected that
we still create capital and liquidity," Herbert Stepic said.
"If you ask me what is the bigger problem, the market or
regulation, I would say it's regulation," Stepic added.
Earlier this week, Deutsche Bank (DBKGn.DE) Chief Executive
Josef Ackermann said the onus was now on regulators and
politicians to ensure that momentum didn't end up distorting
competition or imperil a sustained economic recovery.
"The G20 consensus on a coordinated crisis response is
showing signs of weakening, as lawmakers increasingly feel the
domestic political pressures and want to be seen as 'doing
something'. I regard these developments with concern," Ackermann
said this week. [ID:nLDE6AF29C]
Central bankers are already working on a new round of bank
stress tests in Europe, shortly after agreeing on Basel III
capital requirements. This comes in addition to new rules on
bonus payments and bank levies, causing some bankers to squirm.
"Banks have to be doing business and not just fill in forms.
There must be a right balance," said Guido Ravoet, secretary
general of the European Banking Federation.
For a factbox on main issues at G20, click on [ID:nTOE69K01G]
For FACTBOX on G20 financial regulation agenda [ID:nTOE69M00S]
For a PDF on Basel III click here: r.reuters.com/zys68p
For more stories from Euro Finance Week see [ID:nLDE6AE1IS]
But some appear to think the banks are crying wolf.
Bundesbank official Andreas Dombret signalled that Basel III
rules alone would not scupper an economic recovery.
"Fears of dire consequences appear to be exaggerated,"
Dombret said, adding that it's too early to discuss the impact
of supplementary rules, since they have not yet been formalised.
And IMF Managing Director Dominique Strauss-Kahn said much
remains to be done.
"There is still a lot to do because regulation is fine and
necessary but there are three pillars: regulation, crisis
resolution and financial supervision. On financial supervision
we have not done enough," Strauss-Kahn said.
Deutsche Bank estimates Basel III rules will increase
so-called risk weighted assets for European investment banking
businesses by 77 percent. This would mean European banks needing
to raise well over 300 billion euros of capital, on top of the
approximately 450 billion euros raised during the three years of
the crisis in more benign market conditions, Deutsche says.
(Reporting by Edward Taylor; additional reporting by Arno
Schuetze and Josie Cox; Editing by Alexander Smith)