Eurocommissaris Almunia (concurrentie) licht plannen herstructurering Duitse banken toe (en)

Good afternoon,

The European Commission, today, adopted a decision approving the restructuring plan of Hypo Real Estate and its core bank pbb Deutsche Pfandbriefbank. I will say a few words later regarding another three German banks.

Today's decision on the Hypo group brings to an end one of the most important State aid cases in the financial sector from the point of view of the state resources involved.

The injection of nearly €10 billion of State capital, the estimated €20 billion involved in relieving the bank of toxic and other deteriorated assets and the liquidity guarantees for a total of €145 billion makes it one of the biggest rescues in bank history.

HRE was nationalised in 2009.

After a careful analysis of the restructuring plan, we are satisfied that the remaining core bank - called pbb Deutsche Pfandbriefbank -will be able to restore long-term viability.

The plan includes sufficient measures to ensure burden sharing by the former owners and the bank.

It also includes measures to limit the distortions of competition created by the huge amounts of state aid.

Based on the restructuring plan, only the core bank pbb Deutsche Pfandbriefbank will be active on the markets in the future, and by the end of the year the size of the HRE group will be less than 15% of the balance sheet of 2008, before the crisis.

The core bank will have two strategic business lines: real estate finance and public investment finance. pbb will carry out its activities based on stable funding (covered bonds) and improved internal control systems.

All other activities of Hypo Real Estate will be run down; including, in particular, the Irish-based DEPFA Bank plc.

Infrastructure finance, capital markets activities, and asset management activities will also be phased out.

Turning to the other German Landesbanken cases on my table, I am also happy to say that an agreement has been reached on the restructuring plan of HSH Nordbank, the bank of the of Schleswig Holstein and Hamburg.

A decision is being prepared for the College - for discussion after the summer break - but I am satisfied that the plan will restore the long-term viability of this institution and provides for adequate burden sharing as well as compensation for the distortions of competition.

Second, we are very close to a solution on the final restructuring of Westdeutsche Landesbank.

According to the new restructuring plan notified by Germany on the 30th of June, the WestLB will be resolved through a break up into several parts, and their subsequent transfer, sale or orderly winding down. We are in contact with the German authorities on the details of this complex operation. I hope that we will be able to agree on the last details of the plan as soon as possible. There are still some details to be negotiated and discussed.

Unfortunately, I cannot be as positive for what concerns the Bavarian bank BayernLB, on which there has been very little progress.

The draft of the restructuring plan we have received from the Bavarian authorities fails to convince me and my services for what concerns two crucial aspects: the viability of the business model of the bank and regarding measures to compensate for the distortions of competition.

The lack of agreement is very disappointing for me as I had hoped we would have been able to find a solution by now on all four banks.

I will not go into the details of the discussion, which is still ongoing. I just want to say that I am waiting for new and more convincing proposals from the Bavarian authorities and that they and the bank should not doubt our resolve to bring this case to a satisfactory conclusion as we have done for HRE, HSH and, hopefully soon, for WestLB.

Europe needs a banking system that is restructured rapidly. And the restructuring needs to address the distortions of competition when there is public money involved. Tax payers' money cannot be wasted supporting non-viable banks, or misused creating distortions within the EU's internal market, and a fair burden sharing is required.

The European economy needs banks that are fully up to what should be their main task: the financing of the real economy. And state aid control rules play a key role in delivering this objective.

I will conclude by saying a few words about the stress tests published last Friday.

As I said, the repair of the EU banking sector is key for a successful exit from the crisis. Like my colleagues Michel Barnier and Olli Rehn, I welcome the publication of the results of the stress test as they represent a good step towards this process.

Even before the tests, many countries and their banks have taken actions to strengthen the resilience of their balance sheet though private sector funding or government aid when the private funding was not available.

This year's stress tests are more rigorous than those conducted previously. This is testimony of the good work conducted by EBA.

For those banks that have not met the threshold, they will need to recapitalise. If they cannot do it on the markets and have recourse to state money, they will need to submit a restructuring plan to my services.

The Commission will deal with any state recapitalisation requests cooperatively and quickly, as we have done in the past for more than 50 cases.

Thank you.