EU regulators probe German rescue of WestLB bank

[struggle4progress]

Source: AP

BRUSSELS, Belgium (AP) - EU antitrust regulators said Wednesday they will investigate a German bailout of regional bank WestLB when threatened with collapse after racking up huge losses on investments based on U.S. subprime mortgages. The European Commission said the investigation into the long-term restructuring plan for the bank was to ensure it met EU rules to avoid legal challenges from rivals.

The Duesseldorf-based bank lost .. (US$2.5 billion) last year and was one of several European banks exposed to the subprime crisis that has wiped billions of euros (dollars) from banks' balance sheets.

The banks' public shareholders - the state of North Rhine-Westphalia and a pair of regional savings-bank associations - moved to shield the bank and press it to cut costs to help it survive.

They won EU approval in April to give WestLB a .. (US$7.8 billion) banking guarantee for six months while they came up with a more detailed plan to keep the bank going ...



Read more: http://www.pr-inside.com/eu-regulators-probe-german-rescue-of-r838168.htm