BERLIN (Reuters) - Germany's financial stability committee warned on Wednesday that low interest rates and funds owed by creditors in some heavily-indebted euro zone states posed risks to the German economy, but overall stability had improved in the last year.
In its first report, the committee founded in January 2013 which includes members of the Bundesbank, the finance ministry and the German financial regulator (Bafin) said there were still a series of "acute and latent risks".
The watchdog was set up as a result of the global financial crisis to act as an early-warning system and spot potential problems in the financial industry.
"In general, low interest rates and lenient financial conditions are fertile ground for the development of financial risks," the committee said.
The watchdog looked closely at Germany's housing market but said it found no evidence of an asset bubble, while highlighting the risks to the life insurance sector from low interest rates.
Germany is planning to lower the guaranteed rate of interest that life insurers offer as part of a package of measures to ease pressure on the sector.
yahoo.com
In its first report, the committee founded in January 2013 which includes members of the Bundesbank, the finance ministry and the German financial regulator (Bafin) said there were still a series of "acute and latent risks".
The watchdog was set up as a result of the global financial crisis to act as an early-warning system and spot potential problems in the financial industry.
"In general, low interest rates and lenient financial conditions are fertile ground for the development of financial risks," the committee said.
The watchdog looked closely at Germany's housing market but said it found no evidence of an asset bubble, while highlighting the risks to the life insurance sector from low interest rates.
Germany is planning to lower the guaranteed rate of interest that life insurers offer as part of a package of measures to ease pressure on the sector.
yahoo.com
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