Ailing German Landesbank HSH Nordbank has confirmed the sale of loans valued at €1.64 bn to a number of financial institutions, including €540 mln of real estate loans to Bank of America Merrill Lynch.
Following the deals, HSH will have divested around half of its €3.2 bn loan portfolio, which is believed to include about €2 bn of real estate debt, with Australia's Macquarie Group purchasing around €800 mln of aviation loans.
According to HSH's chief executive, Stefan Ermisch, the sales represented an 'important milestone on the road to a change of ownership'. He added: 'It ensures that the bank will be further relieved of legacy assets, as agreed with the EU'.
Under a deal struck with the European Commission after the bank was bailed out in 2008 by the two German states that own it, Hamburg and Schleswig-Holstein, HSH's owners were charged with selling the €3.2 bn portfolio by the middle of 2017.
The bank, one of the world's largest lenders in the shipping industry, already offloaded €5 bn of non-performing shipping loans to a public-sector owned off-balance-sheet vehicle last July.
'We are currently involved in talks at an advanced stage about the sale of further packages from this market portfolio. These also relate to non-strategic legacy exposures in the areas of energy as well as international real estate,' concluded Ermisch.
