Scholz plays down threat of SVB meltdown to Germany

President of Azerbaijan Ilham Aliyev visits Berlin

BERLIN (Reuters) – Chancellor Olaf Scholz on Tuesday said Germans should not have major concerns about the fallout of Silicon Valley Bank’s collapse and that regulators had learned lessons from the global financial crisis in 2008.

Scholz was speaking alongside the president of Azerbaijan, Ilham Aliyev, in Berlin, who said his country wanted long-term contracts for gas deliveries to Europe, and also for renewable energy deliveries.

Silicon Valley Bank’s collapse pressured global bank stocks further on Tuesday as investors fretted over the financial health of some lenders, in spite of assurances from U.S. President Joe Biden and other policymakers.

“We have made significant progress since the situation of the 2008/09 financial crisis,” Scholz said, seeing better public oversight of the banking system.

The “very clear response” from U.S., British, European and German officials showed the situation was being closely monitored and actions taken quickly, he said.

“That’s the best thing you can do to ensure the safety of systems,” emphasized Scholz. “In this respect, there’s really no reason for anyone here in Germany to have major worries.”

(Reporting by Matthias Williams and Andreas Rinke; Editing by Madeline Chambers and Miranda Murray)