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Siemens Says European Banks Are Too Small for Global Needs
At a glance
- •Siemens needs banking partners with global reach; European banks are often too small.
- •Domestic mergers among European banks will not be sufficient to match US global banks.
- •Strengthening capital markets and reducing regulatory complexity are priorities.
- •Siemens has frequently relied on US banks as partners.
- •So far, the Iran war has not forced Siemens to revise its profit outlook.
- •Siemens is cautious about treating defence as a major new growth area despite potential productivity gains.
Market Analysis
Siemens CFO Ralf Thomas warns that Europes banks are simply too small to serve the needs of globally operating industrial champions. In an interview with Börsen-Zeitung, the Munich-based technology groups finance chief made clear that Siemens requires banking partners with global reach and that, in many cases, the company has turned to U.S. banks for that capability.
Thomas argued that consolidation within Europe, such as domestic mergers, will not be enough to close the gap with the largest U.S. banks. While he declined to give an opinion on UniCredits bid for Commerzbank, he said bluntly that more is required than European banks merely merging with one another. Instead, he called for a stronger capital market and a regulatory environment that allows more flexibility and less cumulative bureaucracy. "If after months of debate we shred 100 rules but receive 500 new ones from, among others, Brussels, that's not a solution," Thomas said, adding that regulators should set a clear framework but allow more room for movement inside it.
Broader Implications
Thomas also commented on geopolitical risks and the industrial implications of higher defence spending. He said the direct impact of the Iran war on Siemens to date is limited and that the company does not expect to revise the profit forecast it raised in February. While acknowledging that Siemens could likely help defence manufacturers raise productivity at existing sites because these operations typically lack the mass-production scale of the auto industry he stopped short of calling defence a new strategic growth pillar. The CFO said Siemens is weighing how to respond appropriately.
Taken together, Thomass remarks underscore a wider tension in European finance and industry: large multinational manufacturers need global, deep-pocketed financial partners and capital markets that can support international operations. For policymakers, the message is twofold reduce paralyzing regulatory complexity and create conditions for capital markets to scale up while for European banks, it is a reminder that scale, global networks and product breadth will determine which institutions can be true partners to global corporates.
The full interview with Ralf Thomas is available on BörsenZeitung online.
