Germany may consider other credit measures

BERLIN (Reuters) - Germany will consider other measures to supply its economy with credit if its "bad bank" plan proves insufficient, Finance Minister Peer Steinbrueck told a German weekly.

Germany's Bundestag lower house of parliament on Friday approved a "bad bank" plan that aims to relieve banks by enabling them to shift billions of euros in troubled assets off their books.

"If we see a real credit crunch in the second half of this year, then the government will have to sit down with the Bundesbank and look for solutions," Steinbrueck said in an advanced release of remarks to run in Sunday's Bild am Sonntag newspaper.

"Then we would have to think about measures, that we haven't had so far," he said.

Steinbrueck said the "bad bank" plan -- which will enable banks to offload toxic assets that have hindered lending activity and aggravated Germany's deepest post-war recession -- was necessary for a stabilisation of the economy.

"Whether it is enough, remains to be seen," he said.

Steinbrueck was critical of banks not passing on credit that they were getting at low rates from the central bank.

"Banks currently prefer to use that money to invest in foreign exchange, government bonds and shares instead of passing it on as credit," he said.

The access of medium-sized companies to credit has significantly worsened in the past few weeks, according to a poll to be published on Monday in the weekly WirtschaftsWoche.