Janet Yellen Secretary of the Treasury | Twitter Website
Secretary of the Treasury Janet L. Yellen addressed a roundtable with CEOs of German banks in Frankfurt, Germany, on May 16, 2024. In her remarks, she highlighted the resilience of the global economy despite challenging geopolitical conditions and noted that financial conditions have improved since last year's banking sector turmoil.
Yellen acknowledged ongoing uncertainties, particularly due to geopolitical tensions and potential vulnerabilities such as elevated corporate debt levels and strains in commercial real estate markets. She emphasized the importance of mitigating risks to financial stability in both bank and non-bank sectors through international engagement.
"We see that the global economy is resilient," Yellen stated. "It has outperformed expectations amid a challenging geopolitical landscape, and global financial conditions have eased since last year’s banking sector turmoil."
She expressed interest in hearing from financial institutions about the risks they face, including those stemming from Russia's war on Ukraine and shifting trade dynamics with China. Yellen underscored the significance of compliance with sanctions against Russia.
"Today, I would like to hear from you on the risks you and your clients are facing—from spillovers from Russia’s war on Ukraine, to shifting dynamics in the trade relationship with China, to financial sector vulnerabilities in the region," she said.
Yellen also discussed recent positive developments within Germany and across the EU aimed at strengthening anti-money laundering and sanctions enforcement institutions. She mentioned efforts underway to establish a new German Federal Financial Crime Agency and an EU Anti-Money Laundering Authority.
"As Russia continues to wage its brutal, unjust, and illegal war on Ukraine," Yellen remarked, "Treasury continues to explore new ways to advance the Biden Administration’s key goals: reducing the revenues the Kremlin has to fuel its war of choice against Ukraine."
Yellen pointed out that many financial institutions have enhanced their compliance measures following President Biden's authorization of secondary sanctions against foreign financial institutions involved with Russia's military-industrial base.
"In response, many financial institutions have bolstered their compliance measures in line with OFAC guidance," she noted.
Despite these efforts, Yellen stressed that objectives had only been partially met as Russia continues to procure sensitive goods. She urged heightened vigilance and stricter compliance measures among all institutions present.
"I urge all institutions here to take heightened compliance measures and increase your focus on Russian evasion attempts," she said. "Taking these measures will also help prevent exploitation by other actors such as Iran."
In closing, Yellen thanked participants for their ongoing efforts and collaboration towards combating sanctions evasion.
"Again, thank you for the work you have already done," she concluded. "I welcome the collaboration we have had to date."
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