German financial watchdog sees limited impact of war in Ukraine on financial system

The logo of Germany’s Federal Financial Supervisory Authority BaFin (Bundesanstalt fuer Finanzdienstleistungsaufsicht) is pictured outside a BaFin office building in Bonn, Germany April 15, 2019. REUTERS/Wolfgang Rattay

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BERLIN, June 27 (Reuters) – Germany’s Financial Stability Board said on Monday that the direct effects of Russia’s war on Ukraine are manageable for the entire German financial system, as the direct claims of German financial intermediaries on debtors in Russia are low.

“So far there have been no serious malfunctions in the German financial system,” the finance ministry said on Monday, citing a report from the committee that includes Germany’s central bank, its finance ministry and supervisor BaFin bank.

The report, covering the period from April. 1, 2021, through March 31, 2022, said risks to financial stability were likely to arise, particularly if adverse real economic developments and a sharp rise in interest rates coincide.

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Reporting by Christian Kraemer Writing by Riham Alkousaa Editing by Tom Sims

Our standards: The Thomson Reuters Trust Principles.


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Don F. Davis