Green light in sight for NordLB restructuring
By Sophie Mosca | Monday 09 July 2012
Norddeutsche Landesbank Girozentrale (NordLB) is expected to obtain the European Commission’s green light by 25 July for its restructuring plan. After a 5 July meeting with the Directorate-General Competition, NordLB’s CEO Gunter Dunkel and the Minister-President of Lower Saxony, David McAllister, were optimistic. “The bank’s proven economic model is not questioned. We made concrete commitments to the Commission for a controlled reduction of total assets and balance sheet risks and a strategic reorientation,” explained Dunkel. “The main problems have been solved. Now we just need to settle the details,” commented McAllister.
“There is a tentative agreement on the bank’s restructuring,” acknowledged a spokesman for the EU executive.
NordLB, a German subsidiary of Unicredit, received a guarantee during the crisis on shares held by Lower Saxony and Saxony-Anhalt. Last December, it received another guarantee of €1.67 billion to help it meet obligations to strengthen its capital imposed by the European Banking Authority. The Commission authorised this state aid temporarily and included it in its analysis of the restructuring plan the bank and the Land had to submit.
After its rating was cut by one notch by Moody’s, on 6 June, NordLB intends to make a new start on more sound fundamentals and to focus on its strengths, particularly lending to the maritime sector.