Deutsche Bank CEO urges study of financial bubbles

CEO of Deutsche Bank Josef Ackermann holds his speech during the Euro Finance Week in Frankfurt November 20, 2009.

FRANKFURT (Reuters) - Deutsche Bank Chief Executive Josef Ackermann said the worst parts of the financial crisis are behind us, and cautioned that more time needs to be spent studying how financial bubbles occur.

"A very valid question is how to prevent another crisis," Ackermann told a Frankfurt banking conference.

In particular, the emergence of financial bubbles needs to be studied, since regulators, bankers and politicians do not seem to have made much progress identifying financial bubbles since the Dutch tulip crisis, Ackermann said, referring to inflated prices for tulip bulbs in the Netherlands in 1637.

A recovery of asset prices and markets is not a reason to become complacent since this is a sign of a fragile recovery, at best, said Ackermann, who is also chairman of bank lobby group International Institute of Finance.

He also said the new reality following the banking crisis was a rebalancing of the relationship between free markets and the state.

Shares of Deutsche Bank were up 0.9 percent at 57.83 euros by 0904 GMT, while Germany's blue-chip index was up 0.6 percent.