More European banks require rescue
(3 October 2008 – Europe) A growing number of distressed European banks have been rescued due to the ongoing credit crisis.
Belgium’s Dexia banking group has been given a lifeline by Belgium’s government, with a €6.4 billion (A$11.4 billion) rescue package.
CEO Axel Miller and Chairman Pierre Richard would leave once replacements were found, the bank said.
The Belgian government and shareholders would invest a combined €3 billion, while the French government will invest €1 billion. Caisse des Depots et Consignations, the country's state-owned bank, will put in €2 billion.
Icelandic bank, Glitnir, has been partially nationalised, with the Icelandic Government purchasing a 75 percent stake in it for €600 million.
David Oddsson, chairman of the Central Bank of Iceland, said that Glitnir, which has operations in 10 countries, would have collapsed if authorities had not intervened.
Germany bank, Hypo Real Estate, has also been rescued, with a €435 billion package by a consortium of banks backed by the Government.
Hypo, Germany’s second biggest commercial property lender, has a large reliance on wholesale funding through covered bonds, senior bonds and short-term borrowing to run its business.
A spokesman for Hypo Real Estate said that the consortium has provided Hypo Real Estate Holding, together with its subsidiaries Depfa Bank, Hypo Real Estate Bank and Hypo Real Estate Bank International with a multibillion euro short-term and mid-term credit facility sufficient to cover the group’s funding needs well into the future.
The continuing list of banking rescues in Europe includes Bradford & Bingley in the UK and European banking giant Fortis, which was rescued by the Governments of Belgium, the Netherlands and Luxembourg.
CEO Axel Miller and Chairman Pierre Richard would leave once replacements were found, the bank said.
The Belgian government and shareholders would invest a combined €3 billion, while the French government will invest €1 billion. Caisse des Depots et Consignations, the country's state-owned bank, will put in €2 billion.
Icelandic bank, Glitnir, has been partially nationalised, with the Icelandic Government purchasing a 75 percent stake in it for €600 million.
David Oddsson, chairman of the Central Bank of Iceland, said that Glitnir, which has operations in 10 countries, would have collapsed if authorities had not intervened.
Germany bank, Hypo Real Estate, has also been rescued, with a €435 billion package by a consortium of banks backed by the Government.
Hypo, Germany’s second biggest commercial property lender, has a large reliance on wholesale funding through covered bonds, senior bonds and short-term borrowing to run its business.
A spokesman for Hypo Real Estate said that the consortium has provided Hypo Real Estate Holding, together with its subsidiaries Depfa Bank, Hypo Real Estate Bank and Hypo Real Estate Bank International with a multibillion euro short-term and mid-term credit facility sufficient to cover the group’s funding needs well into the future.
The continuing list of banking rescues in Europe includes Bradford & Bingley in the UK and European banking giant Fortis, which was rescued by the Governments of Belgium, the Netherlands and Luxembourg.
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