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Time has come for banks to prepare for interest rate rises: Bundesbank 

April 24, 2017

Silvia Amaro, CNBC

The time has come for financial institutions to prepare for an environment with rising interest rates, a Bundesbank board member told CNBC on Thursday.

Many risk managers have focused on credit and liquidity risks, but they need to insert interest rate risks into the equation too, Andreas Dombret, an executive board member of the German Bundesbank, said.

"Let's face it, there are quite a number of risk managers who have never seen interest rates rise and who have never seen the interest rate risk and even thought about (it) and have concentrated on credit risk and have concentrated on liquidity risk, so it's about time to prepare for a potential change," Dombret said.

The former vice-chairman of Bank of America's European global investment unit explained that the German central bank is taking interest rate rises "very seriously" and is "actively" working with German banks to ensure that changes to monetary policy will not disrupt them in any way. Read more

 
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