Ackermann: A United Europe to Overcome the Crisis

The financial crisis has brought monumental changes to Europe and its financial industry. These changes must be actively dealt with by EU countries in a united fashion. In a nutshell, this was what Josef Ackermann, CEO of Deutsche Bank and member of Bocconi's International Advisory Council, said in his lecture, followed by a public discussion with Bocconi students, entitled "Europe and the financial industry: adjusting to a new world".
Introduced by Bocconi Rector Guido Tabellini, and Francesco Saita, Dean of the Bocconi Graduate school, Ackermann started by saying that the Bocconi invitation was a tangible sign of the strategic partnership between Bocconi and Deutsche Bank, which also shows the extent to which the German bank has confidence in Italy's capabilities.
Ackermann's lecture discussed the adjustments that Europe and its financial sector have to make to align themselves to the new post-crisis scenarios, which he summarized by reminding listeners of the following points. In 1999 the capitalization of European banks was 42% of world's top 25 total. Now, at the start of 2012, this percentage has dropped to 14%. And the volume of IPOs on the three Chinese stock exchanges was three times larger than on European bourses.

But accepting the inevitable is not sufficient, Ackermann admonished: Europe must adapt to these fundamental changes in a proactive way. Europe must regain the trust of investors, since its international standing has taken a major hit, said the head of Deutsche Bank, who expressed the wish that the effects of the crisis will have a sobering effect on European policymakers. Only a united Europe will be able to maintain its global influence and participate in new global rule-making.
The first problem to be dealt with is the debt crisis in Europe. Ackerman underlined the fact that those who interpret the pressure of financial markets on indebted countries as a defeat of democracy are wrong. It's not the investors and their demands that undermine democracy, he explained, but excessive debt. He hopes the euro will remain a symbol of integration, rather than a thermometer of growing division and resurgent nationalism among member states. According to Ackermann, European countries must address the issue of a new constitutional foundation for the Union.