Claudia Buch: Banks and society in a changing time - why we need broad dialogue

Speech by Prof Claudia Buch, Vice-President of the Deutsche Bundesbank, at the Deutsche Bundesbank symposium "Banking supervision in dialogue", Frankfurt am Main, 5 July 2023.

The views expressed in this speech are those of the speaker and not the view of the BIS.

Check against delivery.

Ladies and gentlemen,

It gives me great pleasure to welcome you today to the Bundesbank symposium.

This is already the 24th event of its kind – but I'm quite sure none of the previous symposiums were held during a period of upheaval like the one we find ourselves in now. The global economy has been hit by severe shocks in the past few years, the geopolitical and macroeconomic situation is uncertain, and episodes of stress in financial markets in March of this year are casting their shadow. A transformation is needed in the real economy to effectively mitigate climate change and deal with the structural challenges of our time. All of this has implications for our liberal economic and social order which go far beyond the financial sector.

Banks cannot directly influence these conditions, but they need to adapt to them. You see, how banks and supervisors react is extremely important: robust banks that have a firm handle on their risks and a sound capital base are vital contributors to a successful transformation. However, especially during periods of upheaval, we cannot rely solely on banks' risk management. Strong supervision that preserves financial stability and gives society confidence in the stability of banks is more important than ever.

It is precisely because supervisors act on behalf of society that we need to engage in constructive and comprehensive dialogue with all groups of society. "Banking supervision in dialogue" – the motto of this series of events – is therefore defined very broadly. Our aim is to deepen this dialogue. Going forward, we intend to reach out even more to relevant groups of society alongside stakeholders in the industry, to explain and discuss what supervisors can and should do, to talk about how we can tackle the challenges of our time.