11. 06. 10. - 15:00

Treichl warns of bank curbing's effects on economy

Erste Bank boss Andreas Treichl has appealed to politicians to consider the effects planned regulations for banks could have on the economy.

Asked what he thought of plans to introduce stricter regulative measures for institutes operating on the European financial market, Treichl said today (Fri): "I think this should certainly be done affecting some departments and business areas of banks.

"But the effects such rulings could have on the economy must be considered too. I don’t think this is the case at the moment, and this is a dangerous situation," he stressed.

Treichl and the chiefs of Austria’s other leading banks were informed by Social Democratic (SPÖ) Chancellor Werner Faymann and People’s Party (ÖVP) Finance Minister Josef Pröll that the coalition planned to introduce a so-called "bank solidarity tax".

Faymann explained the intention of the possible new law, an initiative of his party: "The banks received support when they needed it. Now they should contribute their part."

The chancellor referred to the six billion Euros several Austrian bank institutes received from the State last year to ensure they do not collapse in the economic crisis.

Faymann said he hoped the bank tax would bring around 500 million Euros per year.

A commission formed by government officials and representatives of the banks have been in talks over the past few weeks to discuss in which way banks could be charged to avoid customers feeling the effects.

Critics claimed Faymann’s move was populist and not well considered. Some newspapers claimed he only focused on the simple image of the "big banks having to pay back what they owe the ‘small Austrian citizen’" in a frantic bid to win back voters. The Social Democrats suffered losses in all past 15 federal and provincial elections.

"Faymann was not counselled by his team of experts for economic issues – because he doesn’t have one," magazine profil wrote.

Another topic of heated debate in Austria and Europe is the question of a tax on financial transactions.

Both Faymann and Pröll back plans to introduce such a tax. But while Faymann suggested Austria should press on and possibly set up the new tax on its own if European Union (EU) leaders fail to come to an agreement in the near future, Pröll was adamant the tax must come into force on a European level.

Pröll warned hundreds of thousands of jobs were at risk if Austria pioneers on the issue since firms would relocate their business-making to other countries.

A similar warning came from Deutsche Bank boss Josef Ackermann as he hosted an international meeting of financial institute leaders in Vienna yesterday.

Christoph Leitl, head of the Austrian Economic Chamber (WKO) and ÖVP board member, however, backed attempts to introduce the tax only in Austria. Leitl pointed out this could be done by convincing other EU states to follow and do the same.

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