FRANKFURT, Sept 4 Germany's top financial
lobbies criticised Thursday's rate cuts by the European Central
Bank, saying they hurt savers without bringing economic
benefits, while the new ECB scheme to buy asset-backed
securities to free up lending was also unhelpful.
"Further rate cuts cannot boost credit creation, nor are
they appropriate given the low rate of inflation," the head of
insurance lobby GDV, Alexander Erdland, said in a statement.
Earlier on Thursday, the ECB cut interest rates to a record
low, unexpectedly bringing borrowing costs close to zero to lift
inflation and support the stagnating euro zone economy.
The central bank will also seek to unlock lending by buying
asset-backed securities and euro-denominated covered bonds from
"Instead of taking more monetary measures to ensure the
low-interest rate environment in the euro zone, more sustainable
structural reforms must come into focus," Erdland said.
Germany's corporate banking lobby BDB said the cuts would
provide little benefit but posed dangers.
"The ECB's actions increase the danger that urgently needed
economic reforms in several euro countries will be postponed,"
the federation's head Michael Kemmer said in a statement.
The country's powerful cooperative banking lobby BVR called
the cuts premature and "very questionable", saying the ECB was
removing incentives for people to save for retirement.
Kemmer further criticized the asset purchase plan saying
weak credit creation was largely a result of weak demand for new
loans, not banks' inability to lend.
"The ABS programme does not help," he said. "Without further
economic reforms, especially in Italy and France, the euro zone
risks slipping into long-term stagnation."
(Reporting by Thomas Atkins; editing by Keiron Henderson)