Bremer Landesbank's shipping loans are underperforming, warn
THE European Central Bank (ECB) is demanding that German state-owned lender Bremer Landesbank shore up its capital against non-performing shipping loans, according to three sources familiar with the matter.
But Bremer Landesbank has dismissed the reports as "factually wrong," reported Reuters.
The reports come as NordLB, BLB's majority owner, and BLB is itself bracing for losses this year due to their exposure to shipping.
Bremer (BLB) needs another EUR700 million (US$795 million) in equity, weekly magazine Focus reported, citing talks between the city-state's finance chief and parliamentary leaders.
"There are close discussions with the ECB," one of the sources told Reuters. Strengthening BLB's capital is a "matter of intense talks," a second source said.
A spokeswoman at BLB denied that the ECB is pressuring the bank into making provisions for bad shipping loans, saying the information about the ECB as well as the level of EUR700 million (US$794.91 million) of equity needed "are factually wrong and pure invention."
"NordLB is sufficiently capitalised and fulfils all supervisory capital quotas," a spokesman for NordLB said, refusing to provide further details.
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