FRANKFURT, July 12 (Reuters) - German state-backed
lender NordLB is preparing a sale of its property lender Deutsche
Hypothekenbank as it seeks to repair its balance sheet following heavy
writedowns related to its exposure to bad shipping loans, people close
to the matter said.
The bank has tasked
Rothschild with advising it on options for its restructuring, which
could include the sale of Deutsche Hypo as early as later this year, the
people said, adding that no decisions have been taken so far.
NordLB will only sell profitable Deutsche Hypo if the effect on the bank's capitalisation is large enough, they added.
"All
of the bank's units have been put under scrutiny," a NordLB spokesman
said, declining to elaborate further. Rothschild declined to comment.
Property
lenders such as Aareal and Deutsche Pfandbriefbank (PBB) are seen as
potential bidders for
Deutsche Hypo, as are public-sector banks
including BerlinHyp and other banks and private equity investors.
NordLB
said in April it would not need to turn to its owners for extra capital
to shoulder a record 2016 loss of 1.96 billion euros ($2.25 billion),
caused by 2.94 billion euros in provisions for bad shipping loans.
Germany
was one of the world's main centres of global ship financing before the
2008 financial crisis, and the five German banks with the closest links
to the shipping industry still have around 80 billion euros on loan to
the sector.
NordLB, as well as peers such as
HSH, Commerzbank, DVB and KfW, have taken large writedowns and boosted
capital buffers against the risk of shipping loans turning sour.
Deutsche Hypo had a book value of 1.4 billion euros as of December 2016, according to a company presentation.
Listed peers Aareal and PBB trade at 0.8 and 0.6 times their book value.
Comments
Post a Comment