The relationship between both sides has deteriorated following the transfers of Mario Gotze and Robert Lewandowski and the war of words between BVB coach Jurgen Klopp and Bayern director Matthias Sammer.
Nevertheless, Watzke has insisted there is no need for peace talks.
"We are not at war with Bayern, so we do not need any peace talks," Watzke was quoted as saying by TZ.
"We are each other's rivals, though. We should not act as if we love each other because that's not the case. And nobody on either side can expect something like that."
Watzke then went on to dismiss suggestions that Bayern saved Dortmund from bankruptcy earlier in the 21st century.
"This is all a myth. Bayern loaned 2 million euros to my predecessor against an eight percent interest. It's not like Bayern were Mother Teresa," he said. "This €2 million eventually didn't help us. My first job was to repay the €2 million, which had disappeared by then.
"Loaning money from another club was one of the biggest mistakes ever made. As long as I'm in charge, I would rather beg for money on the streets than take another club's money."
- Robert Lewandowski