BayernLB sues ex-execs over Austrian debacle

Bavaria's state-owned regional bank BayernLB said Tuesday it would sue former board members for damages over its disastrous 2007 purchase of a majority stake in Austrian lender Hypo Group Alpe Adria (HGAA).

BayernLB sues ex-execs over Austrian debacle
Photo: DPA

A source at the German lender told new agency AFP that the bank would file suit against eight former directors this week, seeking damages of around €200 million ($285 million).

Real estate lender HGAA, Austria’s sixth-largest bank, came close to collapse during the global financial crisis and had to be nationalised in late 2009 in order to prevent a potentially disastrous domino effect in the region.

The episode cost BayernLB €3.7 billion and was a major contributor to the bank having to be bailed out itself with billions of euros in German taxpayers’ money.

German public prosecutors are already investigating former managers for alleged abuse of trust over the acquisition.

HGAA, which was hit hard after loans went bad in the Balkans, has also been plagued by scandals in recent years, with Austrian authorities probing it for conspiracy, fraud, embezzlement, money laundering and false accounting.

Flamboyant Austrian far-right leader Jörg Haider, who died in a drink-driving accident in 2008, was also suspected of having received illegal payments as part of BayernLB’s takeover.

A former BayernLB director, Gerhard Gribkowsky, was also arrested in January on suspicion of pocketing tens of millions in illegal payments from a 2005 deal that shook up the ownership of Formula One.


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Germany in talks on further payout for 1972 Olympics victims

The German government says it is in talks over further compensation for victims of the attack on the Munich Olympics, as the 50th anniversary of the atrocity approaches.

Germany in talks on further payout for 1972 Olympics victims

Ahead of the commemoration in September, relatives of the Israelis killed have indicated they are unhappy with what Germany is offering.

“Conversations based on trust are taking place with representatives of the victims’ families,” a German interior ministry spokesman told AFP when asked about the negotiations.

He did not specify who would benefit or how much money had been earmarked, saying only that any package would “again” be financed by the federal government, the state of Bavaria and the city of Munich.

On September 5th, 1972, eight gunmen broke into the Israeli team’s flat at the Olympic village, shooting dead two and taking nine Israelis hostage, threatening to kill them unless 232 Palestinian prisoners were released.

West German police responded with a bungled rescue operation in which all nine hostages were killed, along with five of the eight hostage-takers and a police officer.

An armed police officer in a tracksuit secures the block where terrorists  held Israeli hostages at the Olympic Village in Munich on 5th September 1972.

An armed police officer in a tracksuit secures the block where terrorists held Israeli hostages at the Olympic Village in Munich on 5th September 1972. Photo: picture alliance / dpa | Horst Ossingert

The spokeswoman for the victims’ families, Ankie Spitzer, told the German media group RND that the amount currently on the table was “insulting” and threatened a boycott of this year’s commemorations.

She said Berlin was offering a total of €10 million including around €4.5 million already provided in compensation between 1972 and 2002 — an amount she said did not correspond to international standards. 

“We are angry and disappointed,” said Spitzer, the widow of fencing coach Andre Spitzer who was killed in the attack. “We never wanted to talk publicly about money but now we are forced to.”

RND reported that the German and Israeli governments would like to see an accord by August 15th.

The interior ministry spokesman said that beyond compensation, Germany intended to use the anniversary for fresh “historical appraisal, remembrance and recognition”.

He said this would include the formation of a commission of German and Israeli historians to “comprehensively” establish what happened “from the perspective of the year 2022”.

This would lead to “an offer of further acts of acknowledgement of the relatives of the victims of the attack” and the “grave consequences” they suffered.