Troubled German property financier Hypo Real Estate Group has secured an additional EUR 10 bn in liquidity guarantees from the state stabilisation fund Soffin. The new arrangement comes on top of EUR 20 bn in guarantees already agreed with Soffin.
Troubled German property financier Hypo Real Estate Group has secured an additional EUR 10 bn in liquidity guarantees from the state stabilisation fund Soffin. The new arrangement comes on top of EUR 20 bn in guarantees already agreed with Soffin.
Hypo Real Estate Group said in a statement on Wednesday that it is in ongoing discussions with Soffin regarding 'comprehensive liquidity and capital
support'.
The banking group narrowly avoided becoming the highest profile victim of the credit crunch in early October when it secured agreement on a massive liquidity lifeline from a consortium of the German state and financial institutions. The original sum of EUR 30 bn had to be hastily increased to EUR 50 bn as the full extent of the problems at Hypo Real Estate became known.
Hypo Real Estate, the second largest real estate lender in Germany after Eurohypo, recently reported a EUR 3bn pre-tax loss for the third quarter of 2008. The merger of the group's two banking units, Hypo Real Estate Bank International and Hypo Real Estate Bank, was completed at the end of November. The move was designed to streamline and simplify the group's structure.
