German Bank BayernLB Reports Record EU4.3 Billion in Writedowns

Discussion in 'Wall St. News' started by ASusilovic, Apr 3, 2008.

  1. Bayerische Landesbank, Germany's second-biggest state-owned bank, reported a record 4.3 billion euros ($6.7 billion) in writedowns as the contagion from the subprime-market collapse spreads to the country's Landesbanks.

    Profit fell to 175 million euros last year from 989 million euros in 2006, the Munich-based bank said in a statement today. BayernLB and its owners agreed to cover as much as 6 billion euros in possible losses from 24 billion euros in assets that will be shifted to a new finance affiliate.

    BayernLB's losses from the credit-market slump bring total writedowns at Germany's state-owned banks to more than 11 billion euros. The financial crisis cost Chief Executive Officer Werner Schmidt and the chief risk officer their jobs. Smaller rival WestLB AG yesterday reported its first loss in three years after 2.01 billion euros in markdowns.

    ``The main problem is no one can tell today how the market will develop in the future,'' said new CEO Michael Kemmer, who replaced Schmidt this month. The bank is unable to estimate how much more it will have to write down, he said. Landesbank asking for taxpayer money...
  2. EUR4.3 bln? Meinen Güten! Das is a lots of Weisswurschts!