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Stable Banks in Challenging Times

Contributions of Andreas Dombret at the Deutsche Bundesbank 2010–2018

Andreas Dombret

Stable Banks in Challenging Times is a collection of speeches delivered by Dr. Andreas Dombret, during his eight-year tenure as a board member of the Deutsche Bundesbank, the German central bank. As witness to the challenges created by the global financial crisis of 2008, Dr. Dombret helped shape large parts of the new regulatory framework. He successfully monitored future developments such digitalization, Brexit and climate change and their effects on the risk situation in the global banking industry and his insights are an invaluable look at the inner workings of global financial regulation and policy.
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Foreword by Nigel Higgins

Andreas Dombret

Andreas Dombret was a first-class investment banking adviser who has transitioned seamlessly to the world of central banking. It is not so easy to succeed in both, although one or two of my fellow introducers to this book are shining examples of success in this regard.

What are the characteristics that have made this possible? I first got to know Andreas as colleagues in an advisory firm. He is unusually deeply informed on his subject matter or, I should say, subject matters, given the breadth of his interests. I have seen few advisory bankers hold their own so well with the chief executives of major European banks – resolute, articulate and generally right!

I hope that the example of Andreas’s success in both worlds is one that will be followed more often. Having been in both public and private service, in the profit-making sector and in regulation, Andreas possesses an understanding of the perspectives of both. The importance of this double perspective will only grow. Having been so much part of the cause of the financial crisis of ten to twelve years ago the banks are now more part of the firewall between the pandemic of early 2020 and its economic consequences, working together with governments and central banks to ensure the liquidity and solvency of our economic system. I am sure that Andreas, through this series of talks and beyond, will continue to contribute to this dialogue, which goes to the heart of the purpose of banking, for years to come. 

And that will be in part because there remains much to do. Much was done in the aftermath of the last crisis to improve the stability of the financial and banking system but time will tell whether the capital and regulatory regimes that emerged are truly fit for purpose, for instance, in response to the pandemic crisis, or whether they contain unhelpfully pro-cyclical elements at a time when you need the opposite. Nor has the restoration of the banking system extended sufficiently beyond its capital base to its reputation, not always fairly. Continued dialogue between the banks, the regulators and the public in general is needed here and again I am sure Andreas will play a real role.

Finally I commend to readers Andreas’s observations in his speeches on climate change, as he says “arguably the single biggest negative externality of our time”. These built on the stance taken on this topic during the German presidency of the G20 in 2017 and highlighted relatively early the importance of environmental risk analysis for the banks. We need the perspectives of Andreas now more than ever.

Nigel Higgins

Chairman, Barclays Bank, UK