April 23, 2020 / 7:01 AM / a month ago

German bank lobby warns coronavirus crisis will lead to many defaults

FRANKFURT (Reuters) - Martin Zielke, the new president of Germany’s BdB banking lobby, on Thursday warned that the coronavirus crisis will result in numerous loan defaults.

Europe’s banks are expected to set aside billions to combat future loan losses as they report earnings in the coming weeks.

Zielke, who is also chief executive officer of Commerzbank (CBKG.DE), said in his first speech as the lobby’s president that it had become clear that banks cannot and must not fulfil every loan request, conceding this has “caused annoyance” with some.

“After all, this crisis will leave its mark on the economy and lead to many loan defaults,” he said.

Reporting by Hans Seidenstuecker and Tom Sims; Editing by Michelle Martin

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