The prospect of an almost-as-big-as-Lehman bankruptcy evidently focused the mind of the officialdom. The providers are private firms, but one imagines, a la the LTCM rescue, that they were given a big prod by regulators It appears the amount of the facility is sufficient to refund maturing paper, but likely falls short of the end of troubles for this highly geared bank (a mere 6 billion euros of equity supporting a 400 billion euro balance sheet).
Hypo Real Estate Holding AG, Germany’s second-biggest commercial-property lender, has been provided with a credit facility by a grouping from the German financial industry.
Hypo Real Estate Holding, together with its subsidiaries Depfa Bank Plc, Hypo Real Estate Bank AG and Hypo Real Estate International AG, will receive the short term and medium term credit facility in “a sufficient amount,” Munich, Germany-based Hypo Real said today in a statement on DGAP newswire. The company provided no further details on the facility.
Hypo Real Estate Holding “will have to depreciate the book value of its participation” in Depfa, and a dividend distribution for the financial year 2008 is “not expected,” according to the statement.
Hypo Real Estate Holding may collapse on liquidity problems, Financial Times Deutschland reported yesterday, before the statement was published, in a preview of an article to be published today, citing unidentified people in government and finance familiar with the company.
Ireland-based Depfa Bank is responsible for the problems with real estate investments, the Hamburg-based newspaper said.
Hypo Real Estate Holding, which is listed on Germany’s DAX index, has to refinance a “two-figure billion-euro” sum, the FTD said. German banks and regulators have been discussing a rescue plan for the Munich-based real estate lender for “days,” the newspaper said.