GERMANY - A number of German banks shaken by the financial crisis are now restructuring their real estate businesses.
The real estate division of the regional bank Baden-Württemberg, LBBW Immobilien, has now been renamed Süddeutsche Wohnen, the bank noted in a statement.
Earlier this year, a consortium around real estate company Patrizia had bought 21,000 flats from LBBW's portfolio, leaving the bank with the project development business and a few residential assets.
The bank announced it would widen the range of Süddeutsche Wohnen's residential portfolio beyond the borders of the province of Baden-Württemberg into neighbouring Southern German provinces.
The management will remain the same under Christian Jaeger and Jürgen Rieger.
Meanwhile, Commerzbank, in which the state owns one-quarter since the financial crisis, said it would not realise its plans to create a new 'Real Estate and Ship Finance' department.
Instead, the bank will focus on its core business and integrate Commerz Real into the retail customer business.
Financing of retail properties and ships will be gradually decreased and eventually dissolved, Commerzbank said.
Chairman of the board at the bank, Martin Blessing, named the ongoing financial crisis, as well as new regulations such as Basel III, as reasons for the changes, which require the bank to increase its liquidity and capital ratio.
In the meantime, the new designated head of Deutsche Hypo, Thomas Bürkle, who will succeed Jürgen Allerkamp from July, told the Financial Times Deutschland that the real estate company would withdraw from its US business.
Deutsche Hypo is a subsidiary of the regional German bank Nord LB.
Bürkle also announced a withdrawal from the Spanish market, as well as various spending cuts within the company.