Money Unmoored

Party Time on the Potomac

Potomac
The Cherry Blossom, the Commerzbank vessel of choice.
  • Why it matters

    Why it matters

    The Commerzbank Boat Tour is an institution during the IIF conference in Washington, and serves as a bellwether for the mood of the financial sector.

  • Facts

    Facts

    • The IIF conference coincides with the annual IMF and World Bank meetings in Washington.
    • Commerzbank, Germany’s second-largest bank, had to be bailed out by the German government in late 2008 and early 2009.
    • Martin Blessing has been the chief executive of Commerzbank since 2008.
  • Audio

    Audio

  • Pdf

The first and last time I was on the ship was in 2008, for some pretty hot days back then. The international bankers attending the meeting of the Institute of International Finance (IIF) in Washington were wondering whether the financial world as they knew it would survive the weekend. Germany’s then Finance Minister Peer Steinbrück and France’s former Finance Minister Christine Lagarde tried to allay people’s fears by holding out hopes of political support for the battered global financial system.

Back then, Washington’s weather was humid and tropically hot. The ship was a reproduction of a Mississippi steamboat, but with a modern engine instead of a steam engine, propelled by two paddlewheels on its stern. Each year, the bank sponsors a party for the German delegates on the Potomac, the river that runs through the U.S. capital. Martin Blessing, the chief executive of Commerzbank, Germany’s second-largest bank, stood on the deck of the Commerzbank’s ship back in 2008, welcoming each guest and introducing himself.

In stark contrast, this year was cooler. The guests were calm. Mr. Blessing didn’t stand outside, because it was raining. Instead, he came hurrying down the steps to greet his guests. He is tall, and as slim as the banks’ profit margins. The guests are calm, and although the financial world hasn’t completely recovered yet, somehow everything feels good again.

The guests are calm, and although the financial world hasn't completely recovered yet, somehow everything feels good again.

The Commerzbank “Boat Tour” has been an institution on the sidelines of the meetings of the International Monetary Fund (IMF) and the IIF for many years. One of the open secrets of international conferences is that they allow people from the same country who would almost never cross paths at home to enter into conversation with each other. The same holds true at this event, where the guests are speaking German, at least most of the time. Only occasionally, when a lone American joins a group of Germans, does everyone switch to English.

There are many well-known faces at the event, and everyone seems to be playing his or her stereotypical role. A finance minister from Germany’s Swabia region is singing the praises of his state-owned bank. The head of a Swiss bank doesn’t want to talk about problems in the United States. A former member of the German central bank, the Bundesbank, describes the many things the European Central Bank is doing wrong. Two other former German central bankers stand together for a while – two monetary policy hawks who have been passed over by history. All the conversations are off the record, and yet most of the guests say the same things they are always saying.

There is a distinctly German flavor to the event. The food at the buffet is a mixture of cuisines, but tasty, and the musical entertainment – a singer, a saxophone, drums, an acoustic bass and keyboards – is classically American. But the line at the buffet isn’t as orderly as is usually the case in the United States, and some of the guests lack a command of the easy going American politeness that Germans sometimes interpret as superficiality. Of course, there is plenty of wine and beer.

It’s even possible to learn a few new things. A former colleague talks enthusiastically about his new job in public relations. Another former colleague, who has also gone into PR, explains how he gets the better of journalists.

Only occasionally do some of the guests venture out into the rainy night. The lights of the city flicker on the riverbank, and a plane occasionally flies by overhead, coming in for its approach low over the Potomac. A party boat drifts by, and judging by the high-pitched voices on board, the female contingent is more substantial than it is on our boat, and the average age is 20 years younger.

Mr. Blessing is in a good mood. The stress test his bank is currently undergoing doesn’t seem to be causing him any stress. Speaking with a senior German government official, he jokes that the share price would drop if the ship sank. He isn’t wearing a tie, just as he wasn’t in 2008, but I hadn’t noticed it until the evening. He has something nice to say to everyone, and he always has a few pleasant anecdotes from the life of a top German banker.

Next year’s event will not feature a cruise on the Potomac. That’s because the conference will be held in Lima, Peru, high up in the Andes. But Mr. Blessing promises that he’ll think of something else – maybe a mountain excursion to the Inca temples? German hospitality knows no bounds.

 

Frank Wiebe is Handelsblatt’s New York correspondent and covers the finance industry from there since November 2012. To contact the author: wiebe@handelsblatt.com

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