FRANKFURT -- The head of Deutsche Bank, Germany's biggest bank, said Tuesday that there was no German credit crisis, even though banks have been accused of not lending sufficiently to consumers and businesses.

"There is no credit crisis in Germany," Josef Ackermann told the Bavarian television Bayerischer Rundfunk, adding that in the past year, the amount of credit granted by German banks had increased by 13 percent.

"We have given a lot of money," Ackermann said.

He said that Deutsche Bank loans to small and medium-sized enterprises had grown from 36 to 40 billion euros (45.5 to 50.5 billion dollars) in a year, in response to critics who say banks are favouring large companies.

"We have a real interest in reinforcing the SMEs," Ackermann stressed.

With respect to the government's banking rescue package, which many Germany banks, including his own, have not tapped into, the Deutsche Bank chief said people should be "happy" that some financial institutions did not need the aid.

"Owing to quick and efficient action by the government, many banks are not obliged to ask for the help," he said.

On Nov. 26, German chancellor Angela Merkel hit out at banks for being too proud to tap into Berlin's 480 billion euro (625 billion dollar) rescue package and lend more money to recession hit firms.

Merkel said in a speech to parliament that banks should not refuse help based on "false prestige."

Merkel had already likened banks to "cold blooded creatures in winter," complaining that "they don't move. They are alive but they don't do what you expect."

Meanwhile, the European Commission said Tuesday that it would take a softer line on state bailouts of troubled banks, after countries including Germany, France, Italy, Spain, the Netherlands, Sweden and Austria griped about its hard line handling of bailout schemes.

But on Nov. 7, the European Central Bank's latest survey of bank lending found it had tightened up as markets erupted this year and was set to tighten further in the near future.

The poll of 112 representative euro zone banks "indicate a significant increase in the net tightening of credit standards for loans to enterprises in the third quarter of 2008," the ECB said.

Conditions had also become more restrictive for households, but to a lesser extent, it added.

AFP/Expatica