Sub-prime-hit public German bank WestLB could be sold to private interests, a representative of the savings bank’s shareholders was quoted as saying on Monday.
“We have no taboos, we can talk about anything,” Alexander Wueerst told the Financial Times Deutscheland.
Wueerst is a member of the WestLB supervisory board and represents the interests of savings banks from the North Rhine region.
Along with savings banks from Westphalia, they own more than 50 per cent of WestLB, a regional bank facing grave difficulties owing to the trading losses and heavy exposure to investments backed by high-risk US mortgages on which borrowers have defaulted in large numbers.
Wueerst stressed however that any private investors would have to respect the independence of Germany’s Sparkassen savings banks.
“Private capital could only be accepted in a regional bank on condition that it did not open the way for privatisation of the Sparkassen” themselves, he said.
WestLB shareholders would like to merge it with another regional German bank but suitable partners have been hard to find.
The savings banks’ associations and the state of North Rhine-Westphalia agreed earlier this month on a bail-out package for WestLB.
Meanwhile, another regional bank hit by the collapse of the US sub-prime market, BayernLB, is also looking for a way to rebound.
According to the daily Sueeddeutsche Zeitung, Bavarian savings banks are set to buy a majority holding in BayernLB from the Bavarian government, to merge it with southwestern peer LBBW and create a large southern public German bank.
BayernLB is held equally by the state of Bavaria and the Sparkassen.
The federation of Bavarian savings banks declined to comment in detail on the report, saying in a statement that such a deal could only take place “when financial markets get back to normal and the consequences of the subprime crisis can be clearly determined”. (AFP)