February 2, 2019 / 6:22 PM / 5 months ago

NordLB says owners accept recapitalisation plan of states and savings banks

FRANKFURT, Feb 2 (Reuters) - NordLB’s owners have formally decided to go ahead with a plan to recapitalise the ailing public sector bank with money from two regional states as well as from savings banks, the lender said in a statement on Saturday.

The plan had earlier this week won the backing of its majority owner, the regional state of Lower Saxony, effectively sidelining a rival offer by private equity groups Cerberus and Centerbridge.

The regional state will pump 1.5 billion euros ($1.7 billion) into the lender and provide 1 billion euros in guarantees, in addition to the 1.2 billion the savings banks will inject.

NordLB said its owners had decided to sell a non-performing 2.7 billion euro ship portfolio to an investor and it would wind down its remaining non-performing loan portfolio almost completely by year-end.

While the bank did not name the buyer, people close to the matter said that the buyer of the portfolio, dubbed Big Ben, is Cerberus. Cerberus declined to comment.

$1 = 0.8731 euros Reporting by Arno Schuetze Editing by David Holmes

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