Hanover - The NordLb has received the hoped-for capital injection. The shareholders paid 2.8 billion euros into the share capital.
" Our owners have made great efforts to make the reorientation of NORD/LB possible," said Thomas Bürkle, Chair of the Managing Board at NORD/LB. "We will now continue the course of transformation we are currently on consistently so as to fulfil the expectations placed upon us. The new NORD/LB will build on old strengths but will be significantly more efficient and more resistant to crises. We will still have to overcome major challenges on our way to becoming a sustainably profitable bank.”
Germany was one of the world’s main centres of global ship financing before the 2008 financial crisis, and NordLb was one of the five German banks with the closest links to the shipping industry still have around 80 billion euros on loan to the sector. As well as peers such as HSH, Commerzbank , DVB and KfW, it has taken large writedowns and boosted capital buffers against the risk of shipping loans turning sour.
The State of Lower Saxony participated in the cash capital injection to an amount of EUR 1.5 billion, Saxony-Anhalt to an amount of EUR 198 million, and Sparkasse-Finanzgruppe to a total of EUR 1.1 billion. In addition, the State of Lower Saxony is implementing capital relief measures to an amount of EUR 800 million which primarily come from the takeover of guarantees for two of the bank's credit portfolios. Overall, this results in a total positive capital effect of around EUR 3.6 billion.
The bank, the previous owners and Sparkassen-Finanzgruppe had in principle already approved the capital measures back in the spring. At the start of December, the EU Commission declared that, following the in-depth investigations, the measures planned did not constitute aid, thus paving the way for implementation. In the last week, the federal governments in Lower Saxony and Saxony-Anhalt passed the final resolutions required for implementation of the capital measures. All steps were performed in close dialogue with the relevant supervisory authorities.
The capital measures will also result in changes to the ownership structure of NORD/LB. With a stake of 52.98 per cent in the bank's share capital, the State of Lower Saxony will remain the biggest owner. The State of Saxony-Anhalt will hold a 6.98 per cent stake in NORD/LB going forwards. A total share of 26.70 per cent, divided evenly between two trusts, is allotted to the security system of Sparkassen-Finanzgruppe.