Austria’s Volksbanken Eyes Partners, Options

VIENNA (Reuters) – Austria’s Oesterreichische Volksbanken AG (OTVVp.VI) is searching intensively for partners and sees a range of interested parties, it said on Wednesday.

The Austrian cooperative banking group, whose loss widened to 1.1 billion euros in 2009 from 152 million in 2008, said it was in deep talks with some potential suitors about scenarios for its future strategy.

Austria’s No. 4 bank said it would not rule out sales of its Investkredit unit or property arm Europolis, adding that it was looking for the best solution.

However, Chief Executive Gerald Wenzel told the bank’s annual results news conference that the group’s Volksbank International unit was indispensible as a core business.

A newspaper reported last week that Cerberus-owned BAWAG P.S.K [CCMLPB.UL], Austria’s fifth biggest bank, was mulling buying Volksbanken, which the newspaper said was valued by KPMG at around 700 million euros. [ID:nLDE63C1H1]

Investment bank Lazard is evaluating a range of alternatives for Volksbanken, which was hit by the near-collapse in 2008 of its local government lending unit Kommunalkredit.

(Reporting by Christian Gutlederer)