Deutsche Bank boss doubts Greece will repay loans

14th May 2010, Comments 0 comments

The head of Germany's biggest bank has cast doubt on whether debt-wracked Greece will be able to repay billions of euros (dollars) in loans, prompting fierce criticism in the financial press Friday.

Speaking on ZDF television late on Thursday, Deutsche Bank chief executive Josef Ackermann said: "Over time, I am doubtful whether Greece will really be in a position to achieve" the repayment of the emergency loans.

However, he stressed that Athens had to be propped up, because if it fell, it would lead "with great certainty to a spillover to other countries," sparking "a type of meltdown," he added.

The European Union and the International Monetary Fund have cobbled together a rescue package for Greece worth some 110 billion euros in loans over three years, of which Germany is expected to make available 22.4 billion euros.

The bloc has also pulled together a fund worth almost one trillion dollars designed to prevent such crises happening in the future.

The Financial Times Deutschland said that Ackermann should have kept his views to himself on this occasion.

"There are some times when it is just better not to say anything," the paper wrote.

Politicians, central bankers and the big players in the world of finance have gone out of their way not to say anything that risked "enflaming the debate" about a possible restructuring of Greece's debt, the paper said.

Now, "Ackermann has broken the taboo."

© 2010 AFP

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