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Bundesbank chief resigns

Published on 16/04/2004

16 April 2004

FRANKFURT – The chief Germany’s central bank, Ernst Welteke, resigned Friday after a two-week controversy over a commercial bank paying a luxury hotel bill for him and members of his family.

Welteke, who is also Germany’s member of the European Central Bank rate-setting council, came under growing press from Chancellor Gerhard Schroeder’s government to stand aside after it emerged that Deresdner Bank picked up the EUR 7,661 bill for his family’s four-night stay at Berlin’s five-star Adlon hotel.

As one of Germany’s biggest banks, Dresdner also falls under the supervisory powers of the Bundesbank.

Berlin is thought to be interested in replacing Welteke with top Finance Ministry official Caio Koch-Weser, who Washington rejected as the Schroeder government’s candidate as chief of the International Monetary Fund in 1999.

Last week Welteke took leave from his Bundesbank post while an investigation into the hotel bill take place.

But despite media and political criticism, the 61-year-old Welteke, who as Bundesbank chief was on a EUR 350,000 a year salary refused to resign until Friday.

Berlin could not force him to stand aside as the Bundesbank is constitutionally free of government control.

Welteke, his wife, three-year-old son, 25 year-old son and girlfriend stayed at the Adlon during New Year 2002 , which also marked the launch of the new euro notes and coins.The Bundesbank and Welteke have since paid the bill back.

The Bundesbank board accepted Welteke’s resignation, saying it was the appropriate action when the bank’s reputation was borne in mind.

[Copyright Expatica News 2004]

Subject: German news