Though the German chancellor is the typical target for the political opposition during any election campaign, the SPD is looking to score points with voters who are fed up with the banking sector.
On Tuesday former Finance Minister Peer Steinbrück, one of three possible challengers to from the SPD to take on Chancellor Angela Merkel in 2013, gave his party’s parliamentary group a 25-page paper called “Taming the Financial Markets”.
Business newspaper the Handelsblatt described it as “nothing short of a declaration of war on Germany’s large banks.”
As one of Steinbrück’s advisors put it, “We are also conducting a banking campaign.”
The plan would create a European rescue fund for struggling banks of between €150 billion and €200 billion, which would be funded by the financial institutions themselves.
Steinbrück is keen to shift the liability of a potential collapse from taxpayers to creditors and shareholders – but expects it will take “several years” to build up the fund. The SPD politician also wants big banks to set up a firewall between riskier investment operations and their lending and deposit businesses.
The head of the Association of German Chambers of Industry and Commerce (DIHK), Hans Heinrich Driftmann, told the Rheinische Post newspaper that separating “good banking from bad banking” was no simple matter, and would not prevent another financial crisis.
Steinbrück’s plan was also criticised by the banking industry, with the head of Germany’s BdB banking association, Michael Kemmer, telling public broadcaster ARD that the plan “sounds good, but it won’t help anyone one bit,” besides helping politicians score a few populist votes.
But the proposal found supporters in the executive suite. A poll conducted by opinion research institute Forsa for the Handelsblatt suggested 71 percent of German managers backed tougher banking regulations.
Forsa head Manfred Güllner told the paper that many people, including members of the middle class, had “a great deal of scepticism about the role and the misconduct of individual banks and banking managers.”