Shipping lender HSH Nordbank expects EU probe after new bailout
FRANKFURT Feb 7 (Reuters) - The owners of German public-sector lender HSH Nordbank expect a second investigation by the European competition watchdog after the bank said it is seeking additional state aid.
The world's biggest shipping financier is feeling the effects of a four-year slump in the shipping industry and announced late on Wednesday that it will ask its owners - the regional states of Hamburg and Schleswig-Holstein - to increase their guarantees to 10 billion euros ($13.5 billion) from 7 billion euros.
"We will present this (plan to the European Commission) in Brussels and will fight for a successful outcome," Schleswig-Holstein prime minister Thorsten Albig said.
The European Commission said on Thursday that it is in intensive talks with German authorities but has not yet received any notification.
If it finds that new state aid has been granted, the Commission is likely to require another round of asset sales as well as acquisition and dividend bans.
The requested support would restore HSH's guarantees to the level secured at the height of the financial crisis. Though HSH returned 3 billion euros last year in expectation of an improvement in business, it later realised that it may have to rethink to cope with high provisions for bad ship loans.
Ship charter rates have fallen below breakeven levels as a slew of new vessels, ordered during the boom years, hit the water.
That has already bankrupted several big players and driven others into restructuring as they found themselves unable to service their debt. ($1 = 0.7387 euros) (Reporting by Jan Schwartz and Ilona Wissenbach; Writing by Arno Schuetze; Editing by David Goodman)
- Tweet this
- Share this
- Digg this
- Exclusive - Apple, Google agree to pay over $300 million to settle conspiracy lawsuit
- Ukraine forces kill up to five rebels, Russia starts drill near border |
- Boy and girl on Korean ferry drowned with life jackets tied together |
- Brazilian Congress passes Internet bill of rights
- Microsoft beats Wall Street on new CEO debut |