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"The returns for banks will go back"

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Hans-Dieter Brenner ist Vorstandschef der Helaba. Quelle: dpa

Hans-Dieter Brenner is CEO of Helaba. Source: AP

Handelsblatt: Mr. Brenner, the federal government wants the financial transaction tax. now everything is good, this is the solution?

Hans-Dieter Brenner: I think the financial transaction tax for a limited expedient to avoid speculation the ground. The decisive factor is still set to reach markets on which part of the tax. Only on listed financial instruments? Or even on off-exchange transactions? And how to measure them? To the area where it does because of the size of the daily global trading volume much sense, is one example and the foreign exchange trading. In any case, such a tax will only work on a global level. Anything else would only bring a competitive disadvantage for the financial center of Germany with himself.

HB: Can not be taxes specifically levied on a small number of financial instruments – such as credit default swaps -?

Brenner: That’s easier said than done. The bulk of the gains is attributable due to the linkage of business in today’s practice portfolio management difficult individual transactions and individual instruments. A flat tax would make the transactions solely for the purpose of risk reduction. We therefore need not tailor-made solutions to new negative developments in financial markets encouraged.

HB: The financial decided last week Leerverbote on financial stocks and credit insurance. Welcome you at least this step?

Brenner: This is not an easy question to answer because a general ban on lead time to inefficient markets. Of that there can be argument about that. The spot and futures markets need arbitrage opportunities to Preisungereimtheiten to clean up quickly. This is necessary for the functioning of all markets. A ban in principle, the reduced efficiency and the depth of the markets that need to be liquid in order to stem and large transactions.

HB: But how will the supervision of the situation?

Burner: Through a stronger underlying financial instruments with equity by the users. This limits both the number and volume of transactions. This is the right way. Only temporarily, I could not think of a ban. Since it’s only for a limited period. In any case, applies here as with any ban: Going it alone brings little. Concerted actions are needed to prevent an escape in other major markets. It is otherwise operated regulatory arbitrage.

HB: higher capital requirements come to us anyway, if we interpret the signals correctly. The Helaba but is particularly true, right?

Brenner: higher capital requirements are to be expected in any case. If you are referring to our hybrid capital, then it is true that are discussed here in reflecting the significant changes as core capital by the international community. It is also true that the proportion of hybrid capital, which draws primarily from a silent partnership with us is around 50 percent. Most of it comes from the state of Hesse. But here is unfortunately much lumped together. In our case, it is liable for losses as well as ordinary share capital. A termination, has only the bank itself, the term is also unlimited. I do not know why it should arrive at a different assessment.

HB: Since the Anglo-Saxons, however, think differently …

Brenner: Granted, silent deposits are certainly to be explained in Anglo-Saxon countries. There are alternative, preferred shares, also called "Preference Share", and the absorbing but not to my knowledge, such as silent losses. That Germany was in a different development, is also based tax. Hybrid capital has been treated as debt and is tax deductible.

HB: That helps but little in the discussion …

Brenner: I Reche so that hybrid capital is maintained long term in the form of, for example a silent partnership in the order of 35 percent. That is a basis for discussion at the Financial Stability Board, the International Committee of the guards. In any case, we need a longer transition period. If they balance up 5:00 to 8:00 years, I could accept that.

HB: … and what their owners say, their makers?

Brenner: Yes, we must come to a medium term solution. But first we need to know the final framework.

HB: The risk-bearing capacity of the banks, your bank must be greater in spite of all measures. Or it is enough what we already have?

Brenner: Clear and unambiguous: The risk-bearing capacity of the banks should be strengthened. This is only possible by an increase of core and supplementary capital. In addition, the lever must be in the use of equity for banking operations are reduced. This also means: some shops will no longer be worthwhile due to profitability considerations.

HB: So the banks now will make fewer mistakes?

Drives: Just a few large banks and hedge funds have made big mistakes in the crisis that came to us all dearly. This must not happen again, here I have for policy and supervision fully understand. However I ask for a policy with a sense of proportion, as there are institutions that have not caused the crisis, and are well positioned for the real economy is of great importance.

HB: Must be able to handle institutions in case of emergency?

Brenner: That may be useful in individual cases. Overall, this is for me one of the key lessons from the financial crisis. The point is that the size and relevance of individual credit system is no longer a threat to the stability of the financial system overall may be. And it must also give a structure in the banking industry, which ensures a minimum of financial services that are offered to citizens and businesses. Look to Britain. Here are some population groups no longer have access to financial services and are excluded. This can, this should not be. We need competition ..

HB: What does this mean? Do we not have a bank levy or?

Brenner: A bank levy to finance a fund to cushion institutions in doubt, that we should not aspire. Also a link to the existing deposit guarantee I do not consider meaningful. With primary regulatory requirements in future excesses may well be avoided. If a bank levy from a policy perspective, this must be inevitable, however, are based exclusively on the risk level of individual institutions, general measurements to I do not think is effective.

HB: Have they no fear that you think of their strong commitment to commercial real estate on its feet? In the U.S., the situation is still very shaky.

Brenner: That fear, I clearly have not. I can only warn against generalizations in public, it is more important to achieve the quality of individual portfolios. Of course, the U.S. market is difficult, but here just in the first quarter of this year are also positive signs seen. For new transactions, for example, many pension funds, a long-term return to accept from five to six percent. It is not long ago, they called for another seven to eight percent. These are all signs of normalization. This also shows the current market transactions and transactions, showing that the market is reviving.

HB: … but you do have still a kind of concentration risk in the balance sheet?

Brenner: We see things differently, our involvement in the U.S., for example, includes eleven billion dollars, of which just under six billion dollars on office properties, $ 2,500,000,000 to $ 1,200,000,000 and commercial rent to retail use. This is already a risk mix. We also have no Nachrangfinanzierung and our loans at book value, compared with an average of 70 percent. Overall, the U.S. market accounts for 20 percent of our real estate loan portfolio. Despite the attendant with the financial and economic crisis, increase in troubled credit and credit losses, the real estate lending Helaba to all domestic and foreign branches and is profitable.

HB: Because of the current currency fluctuations have you no fear?

Brenner: We have seen a very long time a strong euro at 1.40 to 1.50 dollars. Fundamental is justified in my opinion, but a course in the order of magnitude from 1.20 to 1.25 €. The significant over-valuation has been removed in recent weeks, even though the violent price fluctuations and have caused much confusion. This is due partly to heavy speculation. All in all, it is a warning shot to the countries with high public debt.

HB: What’s Next?

Brenner: The euro will remain a popular and generally stable currency. The problem countries must tackle its structural problems. But the runs, Spain, Portugal, Ireland, Italy and Greece on track. They know that no path leads around a tough fiscal policy – even when it hurts.

HB: You mentioned just Spain? What the commitment is there and how Helaba does one judge the local housing market?

Drives: Our direct involvement in the Spanish real estate is worth around 100 million euros. Our loan portfolio is – compared to other foreign markets – that is relatively small. Helaba involved in the Spanish property market even before the outbreak of the financial crisis in 2008 in selected cases. The slippage in the housing sector in particular, we have observed a critical and we therefore kept away from this market segment entirely. We will maintain our prudent lending policies and act on the Iberian peninsula, first continue with great circumspection.

HB: How do you evaluate the criticism of Finance Minister Schäuble on the return on equity of 25 percent at Deutsche Bank? What happened to your yourself a reasonable return?

Brenner: The comment I do not want. It is clear, however: Even if not yet fixed the future regulatory rules that lead with certainty the expected higher capital requirements to ensure that the attainable yields will decline for banks. For the Helaba as a public institution, I consider a sustainable return target of 10-12 per cent before tax to be realistic.

HB: WestLB is after the exit of its commitment problem in a Bad Bank no longer involve so much risk. If you more attractive as a merger partner?

Brenner: This question is not for us. Here, our owners have clearly positioned. Accept this decision and I support.

BACKGROUND

Landesbank without government help

Hans-Dieter Brenner control the public Landesbank Hessen-Thüringen (Helaba) since the fall of 2008 relatively unscathed by the financial crisis. Unlike Institiute like BayernLB and LBBW Stuttgart Helaba took no state guarantees or capital injections to survive. The former accountant and tax writer came in 2001 and has been on Helaba 2002 to the Board. He pursued a conservative risk policy and adheres to policy debates – unlike his predecessor Günther Merl – rather distant. The bank has 85 percent of the savings banks, ten percent of the state of Hesse, has the rest of the state of Thuringia.