(Reuters) – Austrian lender Oesterreichische Volksbanken’s (OTVVp.VI) supervisory board meets on Thursday to discuss asset sales and capital measures after talks to sell the bank to an Austrian peer collapsed in May.
The board, which in January hired Lazard to look for buyers for the bank, Austria’s No. 4, or some of its assets, will review offers for its loss-making real estate unit Europolis, sources familiar with the board’s plans said.
While several potential buyers have lined up for Europolis, loss-making corporate arm Investkredit is a more difficult sell, while Volksbanken maintains it wants to hold on to its emerging Europe arm, the sources said.
The board will also have to decide how to proceed after talks with Austrian bank BAWAG P.S.K. broke down last month when BAWAG’s owner Cerberus Capital [CBS.UL] and the regional banks that control Volksbanken could not agree a deal.
Volksbanken’s bumper 1.1 billion euro ($1.5 billion) loss last year, made on bad corporate loans and real estate writedowns, has wiped out the 1 billion euro state capital injection the group received last April. [ID:nLD421035]
Chief Executive Gerald Wenzel has said he wants to raise 400 million euros of new capital this year, but as several key shareholders have said they have no intention to boost its capital, the sources for this financing are unclear. [ID:nLI99673]
Regional cooperative banks own 58 percent of Volksbanken, Germany’s DZ Bank (DGBGg.F) owns 25 percent and Austrian cooperative peer RZB [RZB.UL] (RIBH.VI) 6 percent and a unit of Munich Re (MUVGn.DE), 10 percent.
Austria’s government still has money left from the funds it set aside to strengthen its banking sector, but it loathes the idea of bailing out another bank after nationalising Hypo Group Alpe Adria and former Volksbanken unit Kommunalkredit [KKAT.UL]. ($1=.7453 Euro) (Reporting by Boris Groendahl and Eva Komarek in Vienna and Alexander Huebner in Frankfurt; Editing by Erica Billingham)