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Mr. Krause said he had given each banking division targets for reducing lending.
On Wednesday leading executives at Standard Chartered and Goldman Sachs attacked the level of regulation being imposed on banks and blamed it for reducing lending.
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Banks in other countries have long sought to make up for reduced lending by expanding fee-earning businesses such as asset management.
That could remove an extra capital cushion, further reducing lending.
If banks are driven, for any reason, to reduce lending to the private sector, monetary policy may become less effective, ineffective or even counterproductive.
Banks like Barclays, which largely avoided losses on leveraged loans and subprime mortgages that have led to $383 billion of writedowns and credit losses, and private-equity affiliates like the Blackstone Group's GSO Capital Partners are financing deals as Wall Street reduces lending for buyouts to the lowest level this decade.
One way for banks to do so is to reduce lending.
He thought that in America, they would lead to inflation, distortions in the banking system, and reduced lending, and he argued for higher rates.
They could motivate owners through reduced lending rates and reduced premiums," for buildings that meet the standards, Deppe said.
Banking industry representatives have complained that the rules will force them to reduce lending to business and consumers, and have pleaded for more time.
Barclays has tapped the scheme for £6 billion since June and lent almost all of it, while Santander reduced lending by £6.3 billion in the last six months despite drawing down £1 billion.
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